Mubasher: International Monetary Fund (IMF) managing director Christine Lagarde said that central banks across the world should consider issuing digital currencies.

Cryptocurrencies such as Bitcoin, Ethereum and Ripple are “constantly reinventing themselves,” aiming to provide quicker payment settlements and a “more stable value,” Lagarde said during her speech at Fintech Festival in Singapore.

“I believe we should consider the possibility to issue digital currency,” she said, adding that “there may be a role for the state to supply money to the digital economy.”

“This is not science fiction [as] various central banks around the world are seriously considering these ideas, including Canada, China, Sweden and Uruguay,” Lagarde noted.

“They are embracing change and new thinking,” she said.

A state-backed online currency could support public policy goals such as security and consumer protection, as well as “financial inclusion,” the IMF boss stated.

Acknowledging downsides, such as volatility that could put pressure on bank deposits and the need for anti-money laundering and terrorist financing controls, Lagarde sees the risks of digital currencies as opportunities for states to innovate.