IMF: Crypto Money Is Not A Substitute To The US Dollar, It's Just An Asset

IMF Implementing Director, CrystalnicalELova. (Photo; Doc. ClimateChangeNews)

JAKARTA - Implementing Director of the International Monetary Fund (IMF), Kristalinabalva, emphasized that cryptocurrencies cannot be considered as a substitute for the United States (US) dollar in its role as the world's dominant currency.

In his latest interview with Yahoo Finance Live, haphazarva emphasized the importance of distinguishing between money and assets. "Crypto is a different and inappropriate asset class when equated with money," he said.

uringva revealed that the security and risks associated with crypto vary depending on whether the digital asset is supported by other assets or not.

"Crypto supported by [other assets such as fiat, gold, etc.] tends to be safer and less risky, while those that are not supported [other assets] become too risky investments," he explained.

Last week, the US Securities and Exchange Commission (SEC) issued a historic decision for the crypto industry by approving a bitcoin spot Exchange-Trad Fund (ETF) for the first time. A total of eleven bitcoin spot ETF proposals have been approved and started trading on the market the next day.

Although this approval is considered a step forward for wider adoption of Bitcoin (BTC) and mainstream acceptance,ctionalova does not agree that bitcoin is predicted to be a replacement for the US dollar.

"The US dollar remains the dominant currency due to the size of the US economy and the strength of the capital market," Gergieva said.

At the end of last year,ELova urged the establishment of clear regulations and solid infrastructure to reduce risks associated with crypto assets. "High crypto asset adoption could undermine macroeconomic stability," he said, adding that the IMF aims to create a more efficient and accessible financial system by avoiding risks from cryptocurrencies.