The International Monetary Fund considers that using crypto assets threatens the effectiveness of the monetary policy, risking financial and macroeconomic stability. US Senators Elizabeth Warren and Sheldon Whitehouse believe that new information will prove that FTX defrauded its customers.
The International Monetary Fund (IMF) recently urged African governments to tighten their cryptocurrency regulations to protect consumers further. The economists of the international organization pointed to the FTX collapse and the resulting drop in cryptocurrency prices as justification.
The experts believe there should be a balance between risk minimization and innovation maximization. They cautioned that adopting crypto assets as legal tender would threaten public finances.
The IMF also argued it is possible to use cryptocurrencies to transfer funds illegally, thus violating regulations on capital flows. That international organization also said using crypto assets extensively threatens the effectiveness of the monetary policy.
The economists of the IMF reported that 25% of sub-Saharan African countries formally regulate cryptocurrencies, while two-thirds restrict them somehow. For example, countries like Cameroon, Ethiopia, Lesotho, Sierra Leone, Tanzania, and the Republic of the Congo have prohibited cryptocurrencies.
The financial experts pointed out that Kenya, Nigeria, and South Africa are the nations with the most users in the region.
Jack Dorsey, the former CEO of Twitter, said in 2019 that Africa would determine the future of Bitcoin (BTC). Before that, the analysts of KuCoin estimated that the average monthly crypto transactions in the region would grow by 1,386.7%.
Last year, the Central African Republic approved Bitcoin as a payment method alongside the local franc (XAF). Previously, the Salvadoran authorities received constant criticism from the IMF for doing that.
Two US Senators Recommend Strong Action against FTX
US senators Elizabeth Warren and Sheldon Whitehouse urge the Justice Department to take strong measures against FTX. They wrote a letter to Attorney General Merrick Garland and Assistant Attorney General Kenneth Polite to demand justice for the victims.
The plaintiffs stated that they expect the Department of Justice to investigate the events occurring on November 11th. Therefore, they would have to determine why FTX collapsed to punish only those responsible for committing the fraud crime.
However, nobody knows which laws FTX and Sam Bankman-Fried violated or whether they remain subject to US law.
The senators believe that new information emerging from the investigation will help better understand how the collapse of FTX affected its clients.
They also think it may prove that the problems in the crypto industry are beyond the FTX case. That led them to request the Department of Justice to focus on the victims to pursue legal action against those responsible.
Senator Warren recently expressed her antagonism toward the cryptocurrency sector, which she views as a creation of scammers.
Meanwhile, Bitcoin is trading around USD 16,428 and has accumulated a 1.6% gain in the last 24 hours. While its daily trading volume is above USD 19.26 billion, its market capitalization is approximately USD 315.70 billion, according to CoinGecko.
By Alexander Salazar
