The International Monetary Fund (IMF) said Tuesday that the cryptocurrency market turmoil hasn’t quite affected global financial stability.

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Fast facts

  • In a report published Tuesday, the IMF said crypto assets have “experienced a dramatic selloff” that has led to 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.”
  • The IMF added that higher-than-expected inflation worldwide, a worse-than-anticipated slowdown in China, and further negative spillovers from the war in Ukraine have hit a world economy already weakened by the pandemic.
  • Jerome Powell, chair of the U.S. Federal Reserve, said last month the central bank was “not really seeing significant macroeconomic implications so far” with regard to the recent crypto volatility.
  • In May, U.S. Treasury Secretary Janet Yellen mentioned Terra’s UST fiasco at a hearing and reiterated her stance on better oversight of crypto, including stablecoins.

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