IMF officials warn of a sell-off in crypto and stock markets

The cryptocurrency market is expected to fall if an economic recession begins. This view was voiced by Tobias Adrian, head of the IMF’s Monetary and Capital Markets Department, according to Yahoo Finance.

He did not rule out further selling by investors of crypto assets and equities, as well as potential collapses of various algorithmic stablecoins.

The IMF representative noted that some “stablecoins” that are not fully backed by cash are exposed to greater risk. For example, Tether’s stablecoin, in the wake of the TerraUSD collapse, briefly lost its peg to the US dollar.

In a recent IMF report, did not have a material impact on the global financial system.

Nevertheless, Adrian emphasized the need for regulation to protect investors. In his view, regulators should ensure that participants in the bitcoin market comply with securities laws, as well as oversee the crypto industry’s infrastructure:

“There are 40,000 coins. Regulating the coins themselves is difficult, but regulating exchanges and wallet providers for investment — that is quite feasible.”

As reported, Tether pledged to reduce to zero the share of commercial papers in the collateral backing its stablecoin by no later than November 2022.

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