The International Monetary Fund (IMF) has released a report on the regulation and adoption of digital assets in Latin America and the Caribbean. The report highlighted the various approaches taken by governments in the region towards cryptocurrencies and central bank digital currencies (CBDCs). While acknowledging the potential benefits of these digital assets, including financial inclusion and faster, cheaper payments, the IMF recommended that countries focus on addressing the drivers of crypto demand, rather than implementing an outright ban. The report also emphasized the importance of transparency and proper recording of crypto asset transactions in national statistics. The IMF director of the monetary and capital markets department recently proposed a payment system that uses one ledger to record CBDC transactions.
Overall, the report suggests that well-designed CBDCs can improve payment systems’ efficiency and resilience and increase financial inclusion in the region. However, proper regulation is necessary to address the risks associated with digital assets while also promoting their benefits.