The IMF Board “Generally Agreed” that crypto should not be legal tender

The leadership of the International Monetary Fund said that outright prohibitions on cryptocurrencies are undesirable but should not be completely ruled out.

The International Monetary Fund’s (IMF) Executive Board issued a statement Thursday stating that cryptocurrency should not be given legal tender status.

The statement went on to say that “Directors agreed that harsh prohibitions are not the first-best choice, but that selective limitations should apply” to mitigate crypto risks. But, some board members believe that “outright bans should not be ruled out,” therefore the statement did not eliminate the possibility of complete bans.

A whole, consistent, and coordinated reaction is necessary because of the following: “the rising use of crypto assets in certain countries; the extra-territorial character of crypto assets and their providers; and the expanding interlinkages with the financial system.”

The statement went on to say that regulations shouldn’t inhibit innovation and that governments should take use of the underlying digital technologies.

The International Monetary Fund has historically warned against making cryptocurrencies like bitcoin (BTC) the official currency of nations like El Salvador because they might be used to avoid capital restrictions imposed by governments.

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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.

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