📰 Table Of Contents
IMF’s Evolving Stance on Bitcoin
The International Monetary Fund (IMF) has shown a shift in its perspective towards Bitcoin, moving from criticism to recognition of its potential benefits. This change comes after years of skepticism towards cryptocurrencies in general.
Bitwise’s Insight on IMF’s Research
Bitwise, a crypto fund manager, highlighted the IMF’s recent research efforts in a Twitter thread by CIO Matt Hougan. The IMF published a comprehensive 43-page paper on April 5, analyzing Bitcoin as a medium for cross-border value transfer.
Bitcoin Remittance Payments
The IMF’s paper delved into both on-chain and off-chain measures of international Bitcoin flows. It revealed that these flows react differently to traditional factors, with significant cross-border Bitcoin transfers observed in countries facing capital controls or limited global economic access.
Key Takeaway:
- Countries with restricted global economic access show higher relative Bitcoin usage.
Global Bitcoin Usage Trends
Contrary to the low adoption of Bitcoin for capital flows in the United States, other countries exhibit a more substantial embrace of Bitcoin. For instance, data from Chainalysis indicates notable cross-border on-chain Bitcoin flows in Venezuela compared to countries like Canada and the USA.
On-Chain vs. Off-Chain Flows
The study found that on-chain cross-border flows align with crypto sentiment, showing correlations with events like dollar appreciation and stock market volatility. Off-chain flows, on the other hand, are linked to avoiding capital flow restrictions and tend to be smaller than on-chain transactions.
Correlations:
- On-chain flows: Negative correlation with dollar appreciation, positive correlation with stock market volatility.
- Off-chain flows: Correlated with incentives to bypass capital flow restrictions.
IMF’s Growing Interest in Bitcoin
Matt Hougan views the IMF’s research as a significant acknowledgment of Bitcoin’s impact on the global economy. The IMF’s attention to Bitcoin signals a shift in understanding and recognition of its role in the financial landscape.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
