Cryptocurrency 'Could Be The Next Step In The Evolution Of Money', IMF Said

The International Monetary Fund (IMF) shared a video explaining what cryptocurrency is.

Traditional means of transacting money, involves trusting a 'middle man'. For example, someone who wants to buy something from a seller, the payment must be processed by a bank or a credit card company as the entity that connects the two. While transactions are secured, there are drawbacks.

In the video, IMF stated that the 'middle man' often take a cut of the transaction.

What's more, both parties should trust the 'middle man' to protect their sensitive data, and most international payment can take a long time, and also expensive.

"To solve these problems, we could use a special currency that is secure, and based on science of cryptography. Which is a way of protecting information using mathematics. This special type of currency is called a cryptocurrency. and only exists in computer networks."

"When you send someone this special currency, the money goes directly to them, removing the middle man. And at the same time, the transaction is broadcast to the entire network, and record it in a permanent way."

This way, transactions using cryptocurrency can be faster, secure, and cheaper, than when using the so-called 'middle man' like banks or credit card companies.

IMF suggests that cryptocurrency could “completely change the way we sell, buy, save, invest, and pay our bills,” and “could be the next step in the evolution of money.”

The video references the IMF’s F&D (Finance & Development) magazine, June 2018 edition, entitled “Money, Transformed – The future of currency in a digital world.”

When that magazine edition went out, the organization posted the above video on its YouTube channel. Unfortunately for the IMF, the video received little interest.

While the video took a neutral approach, and didn't mention any specific cryptocurrency, it received some criticisms.

For example, some people criticized IMF for missing important points, like the mining processes of cryptocurrency. Many also believed that Bitcoin should at least be mentioned once, considering that the cryptocurrency is the one that started this crypto-craze.

IMF also missed the fundamental points of differentiating fiat and cryptocurrency, when the former is printable by centralized entities like governments and banks, and the latter is decentralized and has a cap to its supply.

And cryptocurrencies like Bitcoin, are powered by blockchain, another thing that IMF failed to say.