A director with the International Monetary Fund (IMF) has warned of further selloffs in both crypto assets and equities. He further warned that more crypto tokens could fail.
Tobias Adrian, director of Monetary and Capital Markets for the International Monetary Fund (IMF), warned about further selling pressure in the crypto market and more crypto token failures in an interview with Yahoo Finance Wednesday.
He said:
We could see further selloffs, both in crypto assets and in risky asset markets, like equities.
What was very worrisome in the 2008 crisis was that the banks were highly exposed to the shadow banks, and we don’t see this exposure of banks to shadow banks through crypto at the moment.
Moreover, the IMF director noted that regulations are needed to protect investors and the financial system. Noting the sheer number of cryptocurrencies in existence, Adrian opined:
Regulating the coins themselves is going to be difficult, but regulating the entry points such as exchanges and wallet providers to invest in those coins, that’s something that is very concrete and very feasible.
The IMF also published a report Tuesday stating: “Crypto assets have experienced a dramatic sell-off that has led to large losses in crypto investment vehicles and caused the failure of algorithmic stablecoins and crypto hedge funds, but spillovers to the broader financial system have been limited so far.”
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