A recent blog post by Christine Lagarde, the Managing Director of the International Monetary Fund says that she is optimistic that Bitcoin and other digital currencies can be used to make the world's financial systems safer.
Though there will be some inevitable growing pains associated with them.
Lagarde pointed out that the tools the cryptocurrency industry leverages have the potential to change the world of high finance by making transactions faster, safer, and cheaper.
The IMF Director uses her blog post to point out that there are quite a few concerns surrounding cryptocurrency and the tools used. Lagarde believes that some of these concerns are indeed legitimate but concedes that some are actually groundless. Her blog post went on to say that she hopes for a world where both digital currency firms and traditional banks could co-exist and run operations smoothly. She thinks this diversity would allow for a more efficient and stronger financial system overall.
The number of people using cryptocurrencies as their preferred method of storing and moving money has increased with every passing year. These individuals prefer the cryptocurrency system over the traditional banking system, especially after the 2008 financial crisis. However, storing funds in crypto is a problem since the value of popular cryptocurrencies like bitcoin have proven to be very volatile. Many people have lost money because of these price movements, especially after the recent spate of hacking incidents at cryptocurrency exchanges.
Lagarde Wants Cryptocurrency Industry To Earn Market Trust
Lagarde has been sounding the horn when it comes to cryptocurrencies for some time now. She once warned about how risky cryptocurrencies were and called for global regulators to crackdown on the industry. As we recently reported as last month, Lagarde was advocating that world governments impose strict regulations to bring the cryptocurrency industry under better control. She warned that letting the cryptocurrency industry develop unfettered would create a new vector for money laundering and terror financing.
In her blog post, Lagarde went on to say
Before crypto-assets can transform financial activity in a meaningful and lasting way, they must earn the confidence and support of consumers and authorities. An important initial step will be to reach a consensus within the global regulatory community on the role crypto-assets should play. Because crypto-assets know no boundaries, international cooperation will be essential
Lagarde's blog post comes ahead of the IMF's upcoming global financial stability report, which is focused on the potential risks in the banking world.