Christine Lagarde, the Head of the International Monetary Fund [IMF] has claimed that Bitcoin and other digital currencies have the potential to make the financial system safer in the future. The price of Bitcoin returned above $8,000 following the comment. However, it remains unclear if the sudden boost is due to the statement. It could also be due to the statement of the Islamic scholar who declared Bitcoin as Halal under the Sharia law.
Olga Feldmeier, CEO of blockchain startup, Smart Valor said:
“I personally think that the rise was due to a large institutional investor, there are a lot of institutions, hedge funds and big investors waiting for the right to step in.”
In a blog post, she says that crypto-assets are the tools that can change the world by making financial activities faster, cheaper and safer. Giving her views about traditional banks and digital currencies working together, she says:
“decentralized applications spurred by crypto-assets will lead to a diversification of the financial landscape, a better balance between centralized and de-centralized service providers, and a financial ecosystem that is more efficient and potentially more robust in resisting threats.”
The IMF head hopes that banks and digital currencies co-exist.
She thinks that a clear-eyed approach can help harness the financial gains and avoid the pitfalls while describing the benefits associated with crypto-assets. She also says that these crypto-assets may have an impact on how we save, invest and pay our bills.
On the other hand, she also believes that these crypto assets must gain the confidence and support of authorities and consumers before it can actually change the financial system.
“An important initial step will be to reach a consensus within the global regulatory community on the role crypto-assets should play. Because crypto-assets know no boundaries, international cooperation will be essential”
Daniel Mathew, a Twitter user said:
“She will never submit to Bitcoin being a possible world reserve currency, because it would undermine her power. I am sure the positive comments about bitcoin is the reason for the sudden rise in bitcoin’s price!”
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