IMF Chief Encourages Readiness for Future CBDC Deployment at Singapore FinTech Festival
Summary:
IMF Managing Director, Kristalina Georgieva, in an address at the Singapore FinTech Festival, urged readiness in the public sector for the future deployment of central bank digital currencies (CBDCs). While she acknowledges the potential of CBDCs to replace cash and provide economic resilience, she admits that global implementation is not imminent. Georgieva also emphasized the importance of advanced tech infrastructure, personal data protection, and possible AI involvement. She introduced IMF's virtual CBDC handbook and acknowledged the role of the Bank for International Settlements (BIS) in digital currency exploration.
In her inaugural address at the Singapore FinTech Festival, Kristalina Georgieva, the Managing Director of the International Monetary Fund (IMF), exhorted the public sector to remain ready for the eventual launch of central bank digital currencies (CBDCs) and associated payment systems. Georgieva harbors positive opinions on the global introduction of CBDCs, though she maintains that it's a goal yet to be achieved, with substantial unknown factors still at play. She stated, “The shift towards CBDCs is not imminent. Nevertheless, approximately 60% of nations are currently examining the concept in one way or another.”
The executive opined that CBDCs have the potential to supersede cash, provide monetary strength in developed nations and foster financial inclusion amongst the underbanked populations. Georgieva posits CBDCs can coexist alongside “private money," serving as a secure and inexpensive alternative. She also underscored the significance of tech infrastructure in CBDC initiatives, the safeguarding of personal data, and even the potential role of artificial intelligence (AI) in strengthening national digital currencies. In addition, she emphasized the need for support of cross-border payments:
"The deployment of CBDCs, when it happens, should facilitate cross-border transactions, which are currently costly, time-consuming, and not widely available. Early preparations can prevent us from having to backtrack in the future."
The IMF chief introduced the organization’s virtual CBDC handbook and recognized the role of the Bank for International Settlements (BIS) in the public sector's investigation into digital currency. The IMF has lately turned its focus to the requisite regulations for cryptocurrencies. On September 29, it offered a crypto-risk assessment matrix (C-RAM) to help nations identify symptoms and signs of potential hazards in the sector. The IMF’s Synthesis paper, co-authored with the BIS, received unanimous approval from the “G20 Finance Ministers and Central Bank Governors Communique” in October.
Published At
11/15/2023 9:17:39 AM
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