Crypto disruptors are “shaking the system,” says Christine Lagarde, Managing Director of the International Monetary Fund (IMF), in an interview with CNBC.
Lagarde acknowledged that assets and startups using distributed ledgers are having a significant impact on the financial sector—”whether you call it crypto assets, currencies, or whatever.”
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She was eager to point out that these assets and companies would have to be regulated, to ensure that they could be trusted by investors and the public. “We don’t want to shake the system so much that we would lose the stability that is needed,” she added.
The technology is already being used or trialled by some of the world’s largest companies. Facebook is reportedly trying to raise $1 billion to start its own cryptocurrency for use on Whatsapp. JPMorgan is testing a digital currency to accelerate transactions between its clients.
Lagarde told central banks to think about using distributed ledgers last November.
The former French finance minister has expressed openness to blockchain technology before. She told central banks to think about using distributed ledgers last November. “I believe we should consider the possibility to issue digital currency,” she said, in a speech at the Singapore Fintech Festival. She drew attention to central banks moving in that direction already. For example, Sweden’s Riksbank says it is considering a digital currency—but not a cryptocurrency. Its value would be backed by the government. That kind of cooperation between traditional financial power structures on the one hand, and distributed ledgers on the other, seems to be Lagarde’s preferred way forward.