According to the Financial Times reported on April 12, the World Bank and the International Monetary Fund (IMF) have jointly deployed a private Blockchain and released IMF cryptocurrency.
What is IMF cryptocurrency?
According to this news, the newly released currency, called "Learning Coin", will only be accessible by the IMF and the World Bank. This coin has no monetary value and is therefore not considered a cryptocurrency. The purpose of the two organizations is to learn more about the underlying technology behind the types of crypto assets. The application of this Blockchain helps to host blog posts, research, videos, and research works.
During the testing process, the World Bank and IMF team will be rewarded with coins for reaching a milestone regarding the educational aspect. The two organizations also built a mechanism for users to exchange coins for real rewards, thereby evaluating how cryptocurrencies can be used in real life.
According to the IMF, banks and financial officials around the world have to work hard to keep up with the rapidly evolving cryptocurrency technology. The representative of the International Monetary Fund said:
“The development of crypto assets and distributed ledger technology is accelerating rapidly, as is the amount of information gained from them. This has led central banks, regulators and financial institutions to admit that a knowledge gap exists between them and this emerging technology. ”
Furthermore, after completing the verification process, the World Bank and IMF will likely use this Blockchain to deploy smart contracts, prevent money laundering and improve transparency in operations.
In early April, the International Monetary Fund CEO Christine Lagarde made a very remarkable remark that Blockchain progress is disrupting the traditional financial sector and impacting the institutions in it. She also said that the potential of Blockchain-based technologies should be welcomed by central banks and financial institutions.
>> You can watch the IMF cryptocurrency video here.
Why does the IMF want to enter the cryptocurrency market with its currency?
Christine Lagarde, IMF CEO, talks about the potential of cryptocurrency very positively. Recently, Russia entered the decentralized cryptocurrency space with 'CryptoRuble' and it is possible that institutions, as well as countries, see the value of cryptocurrency.
The head of the IMF has said before that her institution plays a pivotal role in regulating the global cryptocurrency market, but positively she appears to be on Bitcoin's side. Lagarde argues that global financial institutions are reckless not to track and understand emerging fintech products. "I think we are going to see major disruptions," Lagarde said, at the IMF's annual conference in Washington D.C.
Lagarde also pointed out that the Special Drawing Rights of the IMF (SDR), a currency created by the IMF to serve as an international reserve asset, could incorporate technology similar to others cryptocurrencies. She said:
"What we will be looking at is how this coin can make this technology more efficient and less expensive."
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