IMF Chief Speaks of Crypto ‘Pyramid’ Concerns – But Also ‘Begs’ Not to Abandon Crypto Progress
The head of the International Monetary Fund (IMF) has waded into the terra (LUNA) and UST fallout – seemingly labeling the project a “pyramid,” while also urging regulators to consider the “importance” of the world of crypto and central bank digital currencies (CBDCs).
Bloomberg quoted Kristalina Georgieva, the IMF’s Managing Director, as telling attendees at the World Economic Forum in Davos.
“I would beg you not to pull out of the importance of this world. It offers us all faster service, much lower costs, and more inclusion, but only if we separate apples from oranges and bananas.”
On stablecoins, she added:
“The less there is backing it, the more you should be prepared to take the risk of this thing blowing up in your face.”
Francois Villeroy de Galhau, the Governor of the Central Bank of France, was also speaking at the same event, and claimed that crypto had taken more of a battering than the traditional financial sphere of late, adding:
“My impression is more that in recent weeks, citizens have lost trust in crypto, more than in central banks.”
In a panel event hosted by CNBC, Georgieva further claimed that it was financial leaders’ “jobs” to explain the difference between “real” stablecoins, unbacked stablecoins, digital currencies, and crypto – and began by calling the recent terra/UST crash a “big mess.” She also had a few words to say about bitcoin (BTC).
She opined:
“When a [coin] is not backed with assets, but promises to bring 20% returns, it’s a pyramid. What happens to pyramids? Eventually they fall to pieces. Regulating stablecoins, ensuring interoperability of CBDCs and recognizing that bitcoin may be called ‘coin,’ but it’s not money – all of this we need to work on.”
De Galhau, meanwhile, stepped up his calls
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