IMF Chief Begs Investors Not to Shun Crypto After the Collapse of LUNA

According to reports, the managing director of the International Monetary Fund was quoted as saying that crypto investors shouldn’t completely withdraw from the market after the collapses of stablecoin terrausd and cryptocurrency terra.

The IMF Chief has a message for crypto investors after the collapse of LUNA.

Kristalina Georgieva (managing director of the International Monetary Fund) discussed cryptocurrency Monday at the World Economic Forum’s annual meeting.

Bloomberg reported that she urged people to not completely avoid crypto following the collapse of algorithmic stabilitycoin terrausd and cryptocurrency terra. According to Bloomberg, the IMF managing director said:

I beg you to not lose sight of the value of this world… It offers faster service, lower costs, more inclusion, but only if apples are separated from bananas.

Chief of the IMF stressed that regulators around the world have a responsibility to provide protection and educate investors about the risks associated with crypto assets.

She noted that there are many types of crypto assets, with varying risk levels. She also highlighted the difference between stablecoins backed by cash or algorithmic stablecoins like LUNA.

Georgieva opined:

You should be ready to accept the possibility of it blowing up, no matter how little backing you have.

IMF Chief: Stablecoins Without Assets Will eventually Fall Apart

Georgieva also spoke out on stablecoins in a panel hosted by CNBC in Davos Monday. This is where the biggest mess occurred when we look at stablecoins. She elaborated: “If a stablecoin has assets backing it, it is stable.”

If it isn’t backed by assets but promises a 20% return, it’s called a pyramid. Eventually, they will fall apart.