The IMF has warned of “new vulnerabilities” in its latest report…
Another official body – and in this case, a rather influential one – has sent up a warning flare with regards cryptocurrencies, with the news that the International Monetary Fund – the IMF – has issued a fresh warning.
As part of its World Economic Outlook publication that it’s issued on its website, here, the IMF has issued concerns over the growth of cryptocurrency assets, including Bitcoin. It argues that these could now create “new vulnerabilities in the international financial system”.
The core concerns of the IMF centre around the security of digital currencies, and also their role in criminal activities. Furthermore, the fact that they offer such a dramatic, harder to control alternative to traditional fiat-backed currencies.
The report specifically notes that “cybersecurity breaches and cyber attacks on critical financial infrastructure represent an additional source of risk because they could undermine cross-border payment systems and disrupt the flow of goods and services”.
It goes on to add that “continued rapid growth of crypto assets could create new vulnerabilities in the international financial system”.
These concerns are little surprise, however. The IMF has indicated previously its view that it believes regulation of the crypto sector is a certainty, and that won’t have been helped by a steady stream of headlines this year regarding the more dubious side of crypto.
Quite what action will stem from the IMF’s new warning remains to be seen, but it’s very clear that this is a body with significant influence. At a point where governments across the world are looking for some kind of steer as to how to approach cryptocurrencies, the IMF may just have given them some direction.