Economists at the International Monetary Fund have warned against countries adopting Bitcoin as their national currency. The International Monetary Fund (IMF) is still on the fence about cryptocurrency. In a recent piece, Tobias Adrian and Rhoda Weeks-Brown, two of the organization's most well-known economists, argue that broad Bitcoin use might lead to macroeconomic instability.
They argue that instead of focusing on "productive" tasks, firms should invest large resources in integrating a cryptocurrency.
Because of Bitcoin's significant volatility, the introduction of the currency may cause price fluctuations.
Adrian and Rhoda Weeks-Brown also highlight the bitcoin market's pervasive crime and fraud:
Large price swings, fraud, and cyber-attacks might cause households and organizations to lose money. Although the technology that underpins cryptoassets has shown to be incredibly reliable, technological difficulties may arise. Because there is no legal issuer in the case of Bitcoin, redress is difficult.
In the blog article, the IMF mentioned environmental sustainability as one of the top issues. El Salvador, a tropical Latin American country, became the first to recognize Bitcoin as an official currency alongside the US dollar. The IMF, which is negotiating a $1 billion loan for El Salvador, has slammed the move.
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