“Today we urgently need to build an international payment system”

Lcall by Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), to modernize the cross-border payment system using digital platforms, at a conference in Zurich on May 10, shows the beginnings of awareness financial authorities.

Our monetary system, inherited from Bretton Woods, named after the international conference which, in 1944, organized the world monetary system around the American dollar, is at the end of its tether. And even more so when today it represents a risk of impoverishment and major destabilization for our economies.

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The fragmentation of the global economy is indeed underway, and it is fueled by that of our payment systems. The digitization of payments and currency encourages public and private initiatives, but also the use of currency, a formidable weapon of economic warfare, in international power struggles.

Cryptocurrency is a decoy

The war in Ukraine is accelerating this process of monetary balkanization. By prohibiting the access of certain Russian banks to the Swift international financial exchange system, the United States and its allies have contributed to this hostage of payment systems for political purposes, when on the contrary they should be a collective good, not a tool of exclusion.

This stranglehold of diplomacy encourages the construction of parallel payment systems or the adoption of closed and risky systems, which aim to emancipate themselves from political sanctions and the US dollar. After El Salvador and the Central African Republic which launched the movement, more and more are the countries which, cut off from traditional payment systems, could increasingly use cryptocurrencies, even if the instability of these assets is now proven.

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These countries in Africa and Central America in particular, which do not have efficient payment systems, converted to crypto-assets in the hope that they would facilitate their exchanges, in particular international ones. This “democratization” brandished as a standard by these States is a decoy, given the risks of volatility and destabilization of the economies that we observe today.

Non-interoperable systems

Cryptocurrencies are already finding their limits, while the most advanced economies in the world are wondering today about the regulation of these monetary innovations and the best way to organize their expansion. Finance ministers and central bank representatives from the G7 again called on May 19, at their meeting in Germany, for the rapid implementation of comprehensive regulation of crypto-assets in the wake of the crash of the UST cryptocurrency.

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