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IMF Managing Director Kristalina Georgieva on Crypto: It’s Not Money
Crypto’s last big moment also deserves a big reminder.
The US dollar is still the US dollar, and crypto is just an investment vehicle.
This reminder is a compliment from the International Monetary Fund (IMF), one of the world’s leading authorities on payments and financial stability.
“Our view is that we need to differentiate between money and assets. When we talk about crypto, we are actually talking about an asset class. It could be safeguarded and, in that sense, more secure and less risky, or it might not be.
Georgieva’s comments came just hours before the SEC cleared the way for the launch of new bitcoin-backed spot ETFs last week.
Regulators have given a clear signal to financial institutions such as Cathie Wood Ark and Blackrock (BLACK) to launch these new ETFs. In total, 11 spot bitcoin ETFs have been approved.
Average investors will now be able to gain exposure to the world’s largest cryptocurrency without having to own it. Crypto in your 401k? Hey, if you want that risk and can sleep at night.
The ETFs began trading last Thursday, with the crypto-verse now turning its attention to potential Ethereum ETF approvals this spring.
It’s a big moment for the crypto industry, which has seen booms and busts over the past five years and the fall of former prominent executives like FTX’s Sam Bankman-Fried and Binance’s CZ .
“Our simple advice to all investors is: buy the dip and focus on the new Bitcoin adoption cycle. Minor sell-offs are opportunities given the asymmetric upside ahead,” the analyst said by Bernstein. Gautam Chhugani in a customer note reviewed by Yahoo Finance.
CFO of Coinbase Alesia Haas told Yahoo Finance Sean Smith that it was “a historic day for crypto”, but “it’s a long journey and it’s just one step on the path” in the attempt for crypto to be more widely accepted.
The story continues
Haas believes that the one-time approval of the Bitcoin ETF “will invite billions of dollars who were previously unable to access crypto assets and who were not able to access Bitcoin.”
Despite the latest hype around Bitcoin, the IMF’s Georgieva doesn’t think the day is approaching when the crypto will rival the dollar in stature.
“Look, that day, if it exists, is so far in the future that I don’t think there’s much point in talking about it. Why is the dollar a dominant currency today? Because of the size of the U.S. economy and, most importantly, the depth of capital markets in the United States,” Georgieva explained, comparing the attributes of the dollar to other key global currencies.
“So I, for one, am in no rush to turn my dollars into another currency. That doesn’t mean you shouldn’t, you know, diversify. But I wouldn’t worry too much about [bitcoin rivaling the dollar]. There are things that make me lose sleep, this isn’t one of them.”
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Brian Sozzi is the editor-in-chief of Yahoo Finance. Follow Sozzi on Twitter/X @BrianSozzi and on LinkedIn. Advice on deals, mergers, activist situations or anything else? Email brian.sozzi@yahoofinance.com.
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