The International Monetary Fund is recommending that countries not give cryptocurrencies like Bitcoin status as legal tender.
The IMF made that point as a part of a nine-point action plan for how countries should treat crypto assets.
The financial agency’s Executive Board provided guidance to IMF member countries in the discussion of a paper, “Elements of Effective Policies for Crypto Assets.”
The IMF said action is necessary after the collapse of a several crypto exchanges and assets over the last couple of years.
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The top recommendation was to “safeguard monetary sovereignty and stability by strengthening monetary policy frameworks and do not grant crypto assets official currency or legal tender status.”
The IMF came out against El Salvador in late 2021 when the Central American country became the first to adopt bitcoin as legal tender.
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The Central African Republic has done the same.
.Other recommendations included:
- Guarding against excessive capital flows
- Adopting unambiguous tax rules and laws around crypto assets
- Developing and enforcing oversight requirements for all crypto market actors
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The IMF also recommended countries establish international arrangements to enhance supervision and enforce regulations, as well as set up ways to monitor crypto’s impact on the stability of the global monetary system.
Reuters contributed to this report.