The IMF is working on a global infrastructure that would enable central bank digital currencies (CBDCs) to be transacted between countries, IMF Managing Director Kristalina Georgieva told a conference in Morocco, reports Bloomberg.
The platform will boost the use of CBDCs and provide a common regulatory framework for the digital currencies, Georgieva said.
“For this reason at the IMF, we are working on the concept of a global CBDC platform,” she said.
The IMF wants central banks to agree on a common regulatory framework for digital currencies that will allow global interoperability. Failure to agree on a common platform would create a vacuum that would likely be filled by cryptocurrencies, she said.
A CBDC is a digital currency controlled by the central bank, while cryptocurrencies are nearly always decentralized.
Already 114 central banks are at some stage of CBDC exploration, “with about 10 already crossing the finish line”, she said.
“If countries develop CDBCs only for domestic deployment we are underutilizing their capacity,” she added.
CBDCs could also help promote financial inclusion and make remittances cheaper, she said, noting that the average cost of money transfers stands at 6.3% amounting to $44 billion annually.
Georgieva stressed that CBDCs should be backed by assets and added that cryptocurrencies are an investment opportunity when backed by assets, but when they are not they are a “speculative investment.
