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The International Monetary Fund (IMF) is worried about all the bitcoin love and adoption that’s occurring all over the world. The agency feels that all this bitcoin usage bears some level of danger to the world’s standard financial systems.
The IMF Warns About Further Bitcoin Usage
Interestingly, the IMF recently expressed this concern directly to El Salvador, a Central American nation that declared bitcoin legal tender back in September of last year. Now in its seventh month of pushing the bitcoin wheels, the nation appears to be doing quite well for itself, and the IMF practically got on its knees and begged El Salvador to give up all digital currency ambition in the future, claiming that there were sure to be risks and repercussions.
Nayib Bukele – the president of El Salvador – laughed at this and gracefully gave the finger to the financial agency. Now, the IMF is asking the world to give up bitcoin, not just El Salvador, claiming that standard fiat currencies like the yen, the euro, and USD are at risk of being overtaken or overthrown in some way.
In addition, the IMF says that crypto bears too many risks, as it’s been witnessing in Ukraine following the Russian invasion back in February. The agency explained in a statement:
Repercussions of the Russian invasion of Ukraine and ensuing sanctions continue to reverberate globally and will test the resilience of the financial system through various channels, including… acceleration of cryptoization in emerging markets, direct and indirect exposures of banks and nonbanks, and possible cyber-related events.
Ukraine has seen a huge number of crypto-based donations following the Russian invasion. This money is allegedly being used to boost the region’s military and give soldiers the weapons, fuel, and supplies they need to do their duties and defend themselves.
However, the IMF also says that the number of risks surrounding crypto have increased since the early days of the coronavirus pandemic. Crypto trading volumes have been skyrocketing ever since, largely because people have lost trust in standard financial systems given rising inflation rates and the excess stimulus measures that have been taken which have resulted in excess money printing.
Many now see bitcoin and cryptocurrencies as hedge tools; items that can keep their wealth solid and stable during times of economic strife. The IMF also says that crypto trading in Russia has surged in recent months following the implementation of sanctions on Russia by the United States and its various allies. It appears with the fall of the ruble that many Russians now see crypto as the ultimate way to solidify their wealth.
Making Sure the Sanctions Work
Not long ago, Treasury Secretary Janet Yellen commented:
We are monitoring any attempts to use crypto to evade our sanctions, and we have ample enforcement authority which we won’t hesitate to use.