IMF Says Crypto Crash Hasn’t Hit Broader Financial Market
The IMF details the turmoil in the cryptocurrency market in a new report that raises serious worries about the state of the world economy.

The International Monetary Fund (IMF), a specialized organization that promotes global commerce and ensures the stability of the international monetary system, has commented on recent volatility in the cryptocurrency market.
Despite a "dramatic" sell-off, spillovers to the "broader financial system" have been averted, according to the Washington-based agency, which has gained notoriety for highlighting the enormous financial dangers connected with cryptocurrencies.
Financial Stability Worldwide
The IMF projects the state of the world economy in its latest report, "World Economic Outlook Update: Gloomy and More Uncertain," in light of rising inflation, Russia's conflict with Ukraine, and ongoing disruptions to supply chains around the world.
Despite the recent cryptocurrency meltdown wiping out about $40 billion in investor money and eliminating more than $2 trillion in market value, the IMF acknowledged that its influence on global financial stability has been "minimal so far."
The IMF asserts that despite the fact that the crypto sell-off resulted in "substantial losses in crypto investment vehicles" and "triggered the failure of algorithmic stablecoins and crypto hedge funds," the overall financial system was not damaged.
Terrible Terrain
This follows Kristalina Georgieva, managing director of the IMF, who earlier this year urged investors not to give up on the cryptocurrency market after Terra's meltdown, which was caused by the algorithmic stablecoin UST losing its peg to the US dollar.
Over the course of a week, Terra's value dropped from more than $50 billion to a state of ruin, and this caused a domino effect that caused the market value of cryptocurrencies to lose more than $2 trillion. Additionally, Bitcoin (BTC), the biggest cryptocurrency in the world, dropped below $20,000 for the first time since December 2020.
I implore you not to ignore the significance of our world, Georgieva said. It provides speedier service for everyone, substantially reduced prices, and greater inclusiveness. She continued by saying that in order to protect investors, it is the duty of regulators around the world to erect barriers and provide information.
The IMF reduced its forecast for world growth in its report for the years 2022 and 2023, describing it as "gloomy and increasingly unpredictable." As a result, the organization now projects that the global economy will expand by 3.2 percent this year before further slowing to a GDP rate of 2.9 percent in 2023. The revised estimates show a 0.4 and 0.7 percentage point decline from the original projections, respectively.
This prediction was attributed by the IMF to difficulties brought on by rising global prices, a slower-than-anticipated contraction in China, and the lingering effects of the Ukrainian conflict.
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