The International Monetary Fund (IMF) has called for more comprehensive and consistent regulation of the cryptocurrency sector, following a “rough year” for the industry. The IMF stated that regulations should focus on protecting consumers and corporate governance.
In its latest Global Financial Stability Report, the IMF suggested that stablecoin issuers and crypto conglomerates should have bank-style capital requirements. The report was released in light of the bankruptcy of the FTX crypto exchange in November, followed by the collapse of other crypto- and tech-heavy lenders.
The European Systemic Risk Board (ESRB) also released a warning Tuesday, saying that financial authorities should be able to monitor cryptocurrency leverage, decentralized finance and crypto staking and lending. The ESRB is chaired by the European Central Bank’s Christine Lagarde.
The IMF’s Executive Board has previously shown concern over the potential of crypto to replace legal tender, but stopped short of issuing an outright ban on digital assets. The IMF believes that the need for appropriate regulation of the industry is becoming increasingly urgent.
