IMF CALLS FOR INTERNATIONAL COOPERATION ON POTENTIAL CRYPTOCURRENCIES REGULATION

The International Monetary Fund (IMF) has added its voice to a rising chorus of establishments that have called for international coordination on potential bitcoin regulation warning of the risks of surging cryptocurrency prices.

According to a Bloomberg report, IMF spokesman Gerry Rice said late last week there is a need for “greater international discussion and cooperation among regulators.”

Rice added: “When asset prices go up quickly, risks can accumulate, particularly if market participants are borrowing money to buy. It’s important for people to be aware of the risks and take the necessary risk-management measures.”

The spokesman also stressed that cryptocurrencies pose hazards beyond stakeholders’ losses, and can potentially be used for money laundering, terrorist funding, tax evasion and other fraudulent and illegal activities.

Previously, the IMF has encouraged a balanced approach on cryptocurrency guidelines. Christine Lagarde, managing director of the organization, said in September of 2017 that cryptocurrencies may give traditional government-issued currencies a “run for their money” and it is “not wise” to ignore them.

She added that cryptocurrencies would bring “massive disruptions” and warned that central banks and financial services need to pay closer attention to the technology.

The latest statements from the IMF come after U.S. Treasury Secretary Steven Mnuchin said last week that the Financial Stability Oversight Council has formed a working group to carry out discussion with other U.S. regulators. The group is “very focused” on cryptocurrencies, he said at the time.

“We want to make sure that bad people cannot use these currencies to do bad things,” Mnuchin added

The IMF is not the first organization to call for international cooperation on cryptocurrency oversight. Financial regulators from a variety of major economies have urged G20 president Argentina to add bitcoin regulation to the agenda for this year’s summit.

Germany’s central bank has gone so far as to say that cryptocurrencies cannot be regulated effectively at the local or national level, largely because they are location-agnostic and can easily be transmitted across the globe.