Difficult To Consider Bitcoins, Cryptos As Money: IMF Chief

It has been said by Georgieva: “In the history of money, it is difficult to think of them as money” also he added “De-facto assets” like Bitcoin are not backed by assets that hold their value stable and can rise and fall sharply.”

Since its inception in a 2008 whitepaper, bitcoin has created controversy and news. Its influencers herald the launch of cryptocurrency as the advent of the latest and equitable monetary system. Governments around the globe are keeping an eye on the bitcoin advance warily. Some such as EL Salvador, have established it as currency. But most of the economies, including the US, refuse to recognize it as legal tender. Currently, the government seems to face challenges due to the presence of bitcoin because it cannot be regulated.
The head of the IMF said, “Medium-term fiscal consolidation and growth will put Europe on a sound footing to avoid another sovereign debt crisis despite rising debt levels caused by the COVID-19 pandemic”.

Managing Director Kristalina Georgieva, talking remotely to an event hosted by Bocconi University in Italy, said she regards it as difficult to consider bitcoin and other cryptos as money, as digital currencies backed by central banks to be the most trustable form of digital money.
Georgieva said that Europe was fit to stay away from dissimilar debt crises like the one faced by Greece in the consequences of the financial crisis of 2007-08 globally.

But she said states would have to consider carefully how to transform course to medium-term fiscal consolidation to remove the augmented pandemic-related debt load.

Georgieva said that 110 countries among the IMF membership are at some stage of looking into central bank digital currencies, and a key challenge was how to guarantee interoperability of digital currencies.
“De-facto assets” like Bitcoin are not reversed by assets that grasp their value stable and can rise and fall sharply, Georgieva said, adding: “In the history of money, it is tricky to consider them as money.”

It is “very remarkable how much the international group of people, the central banks, organizations like ours are now actively engaged to ensure that in this fast-moving world of digitalization, money is a source of confidence and facilitates the economy function rather than (being) a risk.”