IMF proposes 3 steps plan for countries to fight against Crypto

The IMF agency published a matrix for the countries to fight against the risks associated with cryptocurrencies.

The International Monetary Fund (IMF) is a major financial agency of the United Nations and an international financial institution funded by 190 member countries. This agency provides aid to financially struggling countries. The main vision of this agency is to bring better economic cooperation between countries & reduce the poverty rate by creating a better environment for employment. 

On 29 Sep 2023, The IMF agency published a paper to help the countries deal with crypto risks easily in three steps, called C-RAM. 

IMF prepared this matrix solution on behalf of the past of FTX and TerraUSD crypto frauds. 

The first step suggests leveraging a decision tree to gauge the crypto sector’s “macro criticality” in response to a country’s economy.

In the next step, the IMF suggests countries examine indicators comparable to those in traditional finance to establish the scope for systemic risk. The last step scrutinizes the national macro-financial implications crypto assets could possess.

Here this matrix solution by the IMF for countries is a basic guidance for regulators to design & develop a set of rules to create a highly compliance crypto regulatory framework. 

Bitcoin use in El Salvador & risks 

The IMF raised alarm against El Salvador’s Bitcoin use and said that there are several risks in the country related to Bitcoin use e.g. financial integrity, financial stability, and consumer protection.

Notably, the IMF agency slammed El Salvador several times in the past for using Bitcoin as a legal tender.

Since the beginning of this year, El Salvador has been buying 1 Bitcoin per day from the country’s fund and currently holding 3,020 Bitcoin with net loss 32%.

Read also: American journalist Michael Lewis claims CZ was responsible for FTX’s bankruptcy