IMF Chief Sees Crypto as Asset Class — Says Bitcoin Won’t Dethrone US Dollar as Dominant Currency
International Monetary Fund (IMF) chief Kristalina Georgieva sees crypto as an asset class, not money. She dismissed concerns of bitcoin potentially displacing the U.S. dollar as the world’s dominant currency, citing the size of the U.S. economy and the depth and sophistication of its capital markets as key factors.
IMF Chief on Crypto and US Dollar Dominance
The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, dismissed crypto as money and explained why she didn’t see bitcoin as a threat to the U.S. dollar’s dominance in an interview with Yahoo Finance Live last week. Georgieva said:
Our view is that we have to differentiate between money and assets. When we talk about crypto, we are actually talking about an asset class.
“It could be backed up and in that sense, more secure and less risky, or it could be not backed up and therefore a riskier investment. But it is not exactly money. It’s more like a money management fund,” she described.
Last week, the U.S. Securities and Exchange Commission (SEC) approved spot bitcoin exchange-traded funds (ETFs) for the first time, marking a watershed moment for the cryptocurrency industry. Eleven spot bitcoin ETFs were approved at once and most of them began trading the next day.
While many view the approval of U.S. spot bitcoin ETFs as potentially fueling wider BTC adoption and mainstream acceptance, the IMF chief disagrees, arguing that bitcoin lacks the necessary qualities to usurp the U.S. dollar’s role as the world’s dominant currency. “Look, this day, if it exists, is so far in the future that I think it is not very useful to talk about it,” she opined, elaborating:
Why is the dollar today a dominant currency? Because of the size of U.S. economy and most importantly, the depth of the capital markets in the U.S.
“So I, for one, am not in a rush to turn my dollars into another currency. It doesn’t mean that you shouldn’t, you know, diversify. But, I wouldn’t worry too much about [bitcoin rivaling the dollar]. There are things that make me lose sleep — that’s not one of them,” the IMF managing director opined.
In December last year, Georgieva called for the establishment of clear regulations and robust infrastructure worldwide to mitigate the risks associated with crypto assets. “The challenge is that high crypto asset adoption could undermine macro-financial stability,” she explained. “Our goal is to make a more efficient, interoperable, and accessible financial system by providing rules to avoid the risks of crypto, and infrastructure by leveraging some of its technologies.”
What do you think about the statements by IMF Managing Director Kristalina Georgieva about crypto and do you think bitcoin can overtake the U.S. dollar as the world’s reserve currency? Let us know in the comments section below.