WASHINGTON, DC – THE International Monetary Fund says the global financial system is evolving rapidly, as cryptocurrencies continue to emerge as a major force in the global economy.
In recent years, digital currencies have grown into a significant part of the financial landscape. However, the Fund cautions that they have also been exploited for illicit activities, including the financing of terrorism.
Amid ongoing geopolitical tensions—including the conflict involving the United States, Israel and Iran—the IMF stressed that safeguarding the integrity of global payments remains a top policy priority.
Speaking during a press briefing at the IMF-World Bank Spring Meetings in Washington, DC, officials underscored the importance of strengthening anti-money laundering and counter-terrorism financing frameworks.
They noted that countries around the world are intensifying efforts to ensure that all payment systems—traditional and digital—remain legal, transparent and compliant. This includes the fast-growing crypto sector, where the IMF has already introduced a policy framework to guide regulation.
The Fund added that it is working closely with the World Bank Group and other global standard-setting bodies to support countries as they roll out regulatory systems for digital assets.
On cross-border payments, the IMF highlighted ongoing efforts to modernize how money moves globally. Officials pointed to the distinction between clearing systems, which are relatively integrated, and settlement systems, which remain more fragmented.
They said innovation is accelerating in both areas, with a mix of traditional account-based systems and newer tokenized models being developed by banks, fintech firms and central banks. While existing global messaging systems remain widely used, newer platforms are beginning to emerge, particularly in settlement, where there is strong demand for faster and more cost-effective solutions.
The IMF also addressed the growing role of hedge funds and other non-bank institutions in global finance. With debt-to-GDP levels rising worldwide—particularly since the COVID-19 pandemic—non-bank investors have taken on a larger share of sovereign debt.
While this has helped governments finance their spending, the Fund warned that it also introduces potential vulnerabilities into financial markets.
As a result, policymakers in countries such as the United States and the United Kingdom are taking steps to strengthen market resilience. These include expanding central clearing mechanisms and introducing backstops from central banks to ensure that government bond markets can withstand economic shocks.
