{"id":60605,"date":"2023-10-02T09:01:06","date_gmt":"2023-10-02T13:01:06","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=60605"},"modified":"2023-10-02T09:01:08","modified_gmt":"2023-10-02T13:01:08","slug":"imf-publishes-working-paper-to-address-crypto-assets-risks","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/imf-publishes-working-paper-to-address-crypto-assets-risks\/","title":{"rendered":"IMF Publishes Working Paper to Address Crypto Assets Risks"},"content":{"rendered":"\n

The International Monetary Fund (IMF) published a working paper matrix that aims to identify potential risks associated with the crypto space <\/a>and policy responses for regulators.<\/p>\n\n\n\n

\"IMF
IMF Publishes Working Paper to Address Crypto Assets Risks<\/figcaption><\/figure>\n\n\n\n

The IMF released a working paper titled “Assessing Macrofinancial Risks from Crypto Assets” on September 29. Burcu Hacibedel and Hector Perez-Saiz proposed a crypto-risk assessment matrix (C-RAM) for countries to identify indicators and triggers of prospective sector risks. The matrix also attempts to summarize potential regulatory responses to the identified risks.<\/p>\n\n\n\n

The matrix employs a three-step strategy. Using a decision tree, the first stage entails determining the crypto-macro criticality or the potential impact on the macroeconomy. <\/p>\n\n\n\n

The next step is to examine comparable indicators to those used to monitor the traditional financial sector<\/a>. The final phase addresses the global macro-financial risks that impact the systemic risk assessment of countries.<\/p>\n\n\n\n

\"\"
Crypto ecosystem links to the traditional financial sector. Source: IMF<\/figcaption><\/figure>\n\n\n\n

For instance, the authors utilized C-RAM to identify hazards in El Salvador, which legalized Bitcoin in September 2021. According to the paper, El Salvador's use of Bitcoin entails market, liquidity, and regulatory risks<\/a>. Authors composed:<\/p>\n\n\n\n

\n

\u201cThe use of crypto assets in El Salvador could also be assessed as macrocritical as recent regulatory and legal changes entail the risk of substantial cryptoization in the country, undermining financial stability and affecting large remittances and other capital inflows.\u201d<\/em><\/p>\n<\/blockquote>\n\n\n\n

The IMF has consistently discouraged El Salvador from adopting Bitcoin. In January 2022, the IMF urged the Central American nation to remove Bitcoin's status as legal tender. <\/p>\n\n\n\n

According to the International Monetary Fund, using Bitcoin as a legal tender poses “large risks” in financial stability, financial integrity, and consumer protection.<\/p>\n\n\n\n

As crypto develops rapidly, regulators are playing catch-up in implementing responses to potential risks in the emerging space. At the behest of the Indian G20 presidency, the IMF and the Financial Stability Board\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> collaborated on a policy recommendations paper on September 7. The paper consolidated standards and recommendations for various hazards associated with crypto activities.<\/p>\n","protected":false},"excerpt":{"rendered":"

The International Monetary Fund (IMF) published a working paper matrix that aims to identify potential risks associated with the crypto space and policy responses for regulators. The IMF released a working paper titled “Assessing Macrofinancial Risks from Crypto Assets” on September 29. Burcu Hacibedel and Hector Perez-Saiz proposed a crypto-risk assessment matrix (C-RAM) for countries […]<\/p>\n","protected":false},"author":12,"featured_media":6758,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[1995,1341,16615],"class_list":["post-60605","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-crypto-assets-2","tag-imf","tag-working-paper"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2021\/07\/Making-any-cryptocurrency-a-national-currency-is-an-inadvisable-shortcut-IMF-officials.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/60605","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=60605"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/60605\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/6758"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=60605"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=60605"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=60605"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}