IMF calls for additional measures to regulate cryptocurrencies

Analysts have expressed concern about the growing correlation between digital assets and stock markets

23.08.2022 - 09:00

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What’s new? The International Monetary Fund (IMF) has released data showing the growing correlation between cryptocurrencies and the Asian stock market. The report’s authors expressed concern about this correlation and pointed to the need to develop additional measures to regulate the crypto market. The experts called on regulators to establish clear guidelines on financial institutions, raise investor awareness, and increase interaction between authorities across jurisdictions.

The full version of the IMF’s report

What other data did the IMF cite? Experts believe that the increased correlation between markets in Asia may be due to the increased adoption of cryptocurrencies by investors, as well as the acceptance of digital platforms and crypto-based investment vehicles in the stock and over-the-counter markets. This poses risks to traditional financial assets, including volatility and default risks.

In May, Gita Gopinath, Deputy Managing Director of the International Monetary Fund (IMF), called cryptocurrencies an extremely risky asset class and noted that they need to be regulated. She pointed to the fall in market capitalization, noting that cryptocurrencies carry huge risks and cannot be classified as a high-yield investment.

In late July, the IMF warned that the crypto market could face further pressure from sellers and continue to fall. Tobias Adrian, Director of Monetary and Capital Markets for the IMF, said that if the United States goes into recession, digital asset rates will fall even further. In particular, he noted the difficult situation in the field of stablecoins.

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