Cryptocurrency Regulation – In a positive statement, the IMF acknowledged the appeal of cryptoassets. Indeed, the subtitle of the piece is “Crypto assets may one day reduce demand for central bank money.” The piece starts by acknowledging the current challenges faced by cryptocurrencies, saying “For the time being, crypto assets are too volatile and too risky to pose much of a threat to fiat currencies. What is more, they do not enjoy the same degree of trust that citizens have in fiat currencies: they have been afflicted by notorious cases of fraud, security breaches, and operational failures and have been associated with illicit activities.” However, the tone quickly changes as the piece continues, adding that “But continued technological innovation may be able to address some of these deficiencies. To fend off potential competitive pressure from crypto assets, central banks must continue to carry out effective monetary policies. They can also learn from the properties of crypto assets and the underlying technology and make fiat currencies more attractive for the digital age.” This is a startling acknowledgement of the appeal of cryptocurrencies and their ability to compete with fiat currencies.
Experimentation began in 2017. The installation is coming. Before 2017 concluded, multiple global central bank organizations announced their plans of creating government-backed cryptocurrencies. The first