Agree with India's stand on crypto regulations, says IMF managing director Kristalina Georgieva

Kristalina Georgieva, the managing director (MD) of the International Monetary Fund (IMF), has said that her thoughts are in sync with India when it comes to regulating cryptos and that the pros and cons must be balanced.

Speaking in an interview with CNBC-TV18 on Friday (9), she said, “India is right to call on the IMF for regulations so crypto does not become like the wild, wild west”. She added that the IMF will “dedicate a team to work on it to balance the pros and cons of cryptos”.

The IMF official also spoke on the role that India can play after assuming the G20 presidency in December this year and said there are three areas of cooperation.

“First, with strengthening the multilateral system. It is now being challenged; there are forces of fragmentation, which would prove damaging to the emerging markets in developing economies. Let’s remember that the emerging growth quadrupled its economy in the last three decades and 1.3 billion people have been lifted out of poverty largely because of international cooperation. So, there is a lot at stake and India will be speaking on behalf of emerging markets in the developing countries… we will be supporting that wholeheartedly," she said.

The IMF MD also said that the world is changing very fast, especially in the digital area. She added that India is right to call on the IMF to ensure that cryptos are regulated.

"For one, they must be differentiated across different asset classes – whether they are not backed like the bitcoin or backed like the stablecoin – which brings with it a separate set of risks such as dollarization -- if the United States wants stablecoin to dominate," Georgieva said.

“Third, at a time when debt sustainability is becoming a growing concern, India being a new donor, a new lender, can play a very important role in advancing that work. A G20 common framework for debt resolution is already in place and it is very important to have a rule book that makes access to it and using it clear – possibly expanding it so that countries like Sri Lanka can find a home in the common framework," she added.