International Monetary Fund concerned about cryptocurrencies

Trading in digital currencies puts consumers' money at risk. The technology also opens the door to money laundering and terrorist financing.

The International Monetary Fund (IMF) has expressed concern about cryptocurrencies, as the US business channel CNBC reported. Consumers are at risk. One of the problems is that many of the individuals and financial institutions dealing in digital currencies "lack strong operational, governance and risk practices". There is "insufficient disclosure and oversight" in this area.

CNBC also quotes Charles Randell, Chairman of the UK Financial Conduct Authority (FCA). He is also concerned: "We simply don't know when or how this story will end, but - as with any new speculation - it can't end well." We don't yet know what will happen over a full financial cycle.

However, it is not only consumers' money that is at risk from cryptocurrencies, the International Monetary Fund believes. It also speaks of security risks. The trade opens "unwanted doors to money laundering and terrorist financing". There could also be some data gaps.

However, cryptocurrencies also offer some advantages. The IMF believes that well-coordinated measures should be taken to ensure that these advantages are maintained and vulnerabilities are eliminated. The issue of cryptocurrencies affects countless people around the world who have invested in them. IMF data shows: All crypto assets surpassed the two trillion US dollar mark in September. This represents a tenfold increase compared to the beginning of 2020.

The latest estimates from the International Monetary Fund could also make many investors and savers in Germany sit up and take notice. Many consumers trade in cryptocurrencies and invest in these assets with well-known German neobrokers, fintechs and the like. This is possible, for example, with the neobrokers Trade Republic, Scalable Capital or Finanzen.net Zero. Popular German crypto exchanges include Börse Stuttgart Digital Exchange (BSDEX) and Börse Stuttgart's crypto app Bison. The Justtrade service from Hamburg-based Sutor Bank, the Berlin crypto bank Nuri (in cooperation with Solarisbank) and the provider Bitcoin.de also offer crypto trading.