Cryptocurrency cannot be a legal tender

Washington: In the last few years, the use of cryptocurrencies has been increasing worldwide, and the International Monetary Fund has presented an important report in this regard. The report recommends that cryptocurrencies cannot become legal tender. At the same time, International Monetary Fund has also suggested that blockchain-like technology, which is used behind cryptocurrencies, can improve exchange transactions worldwide. IMF also mentioned in its report that ‘digital currencies’ launched by various central banks will be important for this.

The International Monetary Fund has prepared a policy paper titled ‘Elements of Effective Policies for Crypto Assets’. It includes points serving as guidelines for the IMF’s member countries regarding crypto transactions. In view of the major scams in the cryptocurrency space in the last two years and the huge losses due to it, there is a need to have controls to deal with such incidents, said IMF.

‘The security of financial sovereignty and stability is important; for this, there is a need to strengthen the framework of credit policies. At the same time, the International Monetary Fund recommended that cryptocurrencies should not be recognised as official currencies. International Monetary Fund has mentioned this as the highest-level recommendation. Moreover, International Monetary Fund also advised developing a system to monitor all the entities currently operating in the crypto sector. The use of cryptocurrencies can reduce the effectiveness of credit policies. It can also defy measures to manage capital. The Mint also informed that the Executive Board of the Mint has agreed that cryptocurrencies can significantly increase financial risks.

The world’s leading investors and economists have issued dire warnings about cryptocurrencies in the past few weeks. American economist and investor Peter Schiff warned that cryptocurrency would soon be on the verge of extinction. Nouriel Roubini, one of the world’s leading economists, has warned that cryptocurrency is a bubble of fraudulent financial schemes that will burst soon. Referring to the ‘FTX’ scam, American economists also caution that everyone should avoid investing in crypto. A leading US bank also issued an alert on crypto transactions.

In the last two years, many scams have come to the fore in the cryptocurrency sector and many companies with different types of ‘tokens’ (coins) have announced scams. Investments in some tokens and companies have completely disappeared, affecting millions of people. It has been revealed that billions of dollars have been completely lost due to crypto investments.

Against this backdrop, economists and investors, including the world’s leading banks, have started to draw attention to the dangers of cryptocurrencies. The International Monetary Fund’s ‘Policy Paper’ and its recommendations are an important milestone.

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