iNDICA NEWS BUREAU-
Cryptocurrencies are here to stay and are clearly the future of payments. As nations across the world are shaken by its decentralized structure, they are outright banning the payment system. This might not only suppress technological advancement but also create a wormhole for illegal activities.
It is in this regard, Indian American Gita Gopinath, the chief economist of the International Monetary Fund (IMF) said that the emerging economies should regulate cryptocurrencies instead of banning them.
On Wednesday, December 15, she called for an urgent global policy on the issue.
“Regulating crypto assets and currencies is essential, especially for emerging and developing economies, as banning them may not work as crypto exchanges are located offshore, which makes it easier for an individual to trade in them despite the ban,” Gopinath said, delivering lecture on ‘Global Recovery and Policy Challenges in 2022’ organized by National Council of Applied Economic Research (NCAER).
No individual country could solve this problem on its own given the complex cross-border transactions, she said. “There is a need for a global policy on it urgently.”
She cautioned that the adoption of cryptos poses a challenge to emerging and developing economies as most of them typically had regulations around foreign transactions.
“Cryptos pose problems as usually emerging developing economies have exchange rate controls, capital controls, and capital flow measures,” she said. “Crypto assets and currencies can be used to evade those regulations.”
