Economists call for increased focus on digital currencies instead of banning them

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The International Monetary Fund (IMF) published an article on Thursday titled “Increasing Central Bank Digital Currencies in Latin America and the Caribbean as Digital Currency Usage Differs.” Economists pointed out that Brazil, Argentina, Colombia, and Ecuador are among the top twenty countries in terms of reliance on digital currencies.

However, they also emphasized that there are challenges and risks associated with adopting digital assets, especially in economically vulnerable countries in the region that suffer from economic volatility, institutional weakness, and corruption. They explained that regulations governing digital currencies vary in Latin American and Caribbean countries, with El Salvador announcing the acceptance of Bitcoin as legal tender while Argentina and the Dominican Republic banned the use of digital assets.

The economists proposed focusing on addressing the reasons for demand for digital assets, meeting the needs of citizens in underserved digital payments, and improving transparency by recording transactions in national statistics. This approach can help effectively deal with the risks associated with digital assets.

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