Cryptocurrency regulation is inevitable, IMF chief says

Christine Lagarde calls on governments to supervise activities instead of the digital currencies

Tags: International Monetary Fund - IMFUnited Arab Emirates
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Cryptocurrency regulation is inevitable, IMF chief says Lagarde has said the IMF may eventually develop its own cryptocurrency.
By  David Ndichu Published  February 12, 2018

IMF managing director Christine Lagarde has said governments will have to acknowledge the inevitability of cryptocurrencies, calling for regulation and supervision instead.

Speaking to CNN on the sidelines of the World Government Summit in Dubai, Lagarde said regulation should focus on activities as opposed to the digital currencies themselves. “We have had an entity based regulation over the past ten years after the financial crisis; we clearly have to move into an activity based regulation. Forget about the entities, work on the activities themselves and who does what and who is licensed to do what and who is properly regulated and supervised.”

The IMF has generally been positive of cryptocurrencies, as opposed to most central bankers. That said, Lagarde has urged caution to deter criminal activities tied to cryptocurrencies. “There is probably quite a bit of dark activities behind that particular scene and we are actively engaged in our anti-money laundering (and) in countering the financing of terrorism.”

Lagarde hasn’t even ruled out the IMF developing its own cryptocurrency at some point. Last year, she pointed to the IMF's Special Drawing Right (SDR), a currency the IMF created to serve as an international reserve asset, which could incorporate technology similar to cryptocurrencies.

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