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- IMF believes these crypto collapses are nothing to worry about if we look at financial stability at the global level.
- The calm shown by IMF is a shock. This is due to various market collapses and mishappenings in the market.
- IMF also argued that El Salvador needs to stop using bitcoin as its official currency.
The Economy Crisis
The International Monetary Fund, commonly known as IMF gave several opinions regarding the crypto market collapses. The main statement was that these crypto collapses are nothing to worry about if we look at financial stability at the global level. The statement was given on Tuesday. IMF said that they know the world is going through a second recession over just two years.
This is impacted highly by the Ukraine war and the 3-year-long Covid era. To add to all these, our economy is suffering from high inflation. Despite this, the IMF says that markets like bitcoin which are not dependent on the traditional banking system are out of the recession. In simpler words, they don’t seem to have a problem.
Financial Threats to The Crypto Market
The calm shown by IMF is a shock. This is due to various market collapses and mishappenings in the market. Some of these collapses include terraUSD stablecoin along with the Three Arrows Capital fund. The IMF stated:
“Spillovers to the broader financial system have been limited so far, citing a dramatic sell-off that has led to large losses for crypto investors”.
In a report published in June, the European Systemic Risk Board stated that the sudden growth in the crypto market can be helped in predicting the trends. According to their predictions, the financial threats are going to rise quickly and powerfully. The IMF has also warned about a lot of things. This includes an appeal for more regulation of the crypto sector. IMF also argued that El Salvador needs to stop using bitcoin as its official currency.
There are many organizations and committees that are working on strategies regarding how banks should enter the crypto markets including the Basel Committee on Banking Supervision.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
