IMF warned widespread use of crypto could lead to banks losing deposits
March 13, 2023
The IMF had warned the G-20 members last month that the widespread proliferation of crypto could lead to banks losing deposits and curtailing lending.
The IMF's report on "Macrofinancial Implications of Crypto Assets" given to the G-20 in February during a meeting in India, was made public today.
Major US banks that had exposure to cryptocurrencies have been sinking recently.
Crypto friendly Signature, Silvergate and Silicon Valley Bank have collapsed within a week from each other.
”There are many risks associated with crypto assets, although the significance and relevance of specific risks differ by country circumstances,” the report said.
The contagion of crypto collapse has spiraled into a wider economic meltdown, with banks struggling to reassure investors and customers.
Earlier, the RBI governor had predicted that the next major financial crisis would stem from cryptocurrencies.