Cryptocurrencies and establishment: The present and the future

With the IMF saying that cryptocurrencies are not
suitable as national currency and US Congress contemplating a tax on profits
earned through them, the crypto market tumbled again on Friday.

While Dogecoin tumbled 2.3%, Bitcoin fell 2.8%. The most affected cryptocurrency is Ripple,
losing 3.5% of its value. Ethereum has fallen the least of all, down only 1.5%.

Also Read | Major tech companies show their interest in bitcoin

In a blog post, IMF called cryptocurrencies such
as Bitcoin “extremely volatile and not good for people who need to
“store value.” The agency also said that these kinds of currencies
are “unrelated to the real economy.” . The IMF argues that crypto
will not prove popular in “countries with stable inflation and exchange
rates, and credible institutions.” In unstable nations, on the other hand,
it has the potential to drive the prices unstable.

IMF also pointed out that cryptocurrency is often
used to “launder ill-gotten money, fund terrorism, and evade
taxes.”  

Also Read | Elon Musk says ‘I pump but don’t dump’ bitcoin

On the other hand, the new bipartisan infrastructure bill that just passed a preliminary Senate vote on Thursday
has  proposed “to raise $28 billion
from crypto investors” by taxing their profits, CoinDesk reported. 

Though
they are falling today, the crypto market may actually benefit from the tax
proposal. When a new revenue stream emerges for the government, it may actually
help in mainstreaming virtual currencies. The current trend though is
against such currencies. Most of the governments have taken an antagonistic
approach towards them because of their non-traceability, fueling fears that the
currencies could be used for funding illegal activities and crime.