USA: Presidential decree on cryptocurrencies is imminent
The executive order is intended to provide more clarity on the interpretation of crypto regulations and the role of different authorities. The main focus will be on evaluating the benefits and risks of using cryptocurrencies, stablecoins and central bank digital currency.
The course setting for what is perhaps the most exciting development in the crypto sector could be ahead of us in the next week. According to a recent report, the White House will issue a presidential executive order on cryptocurrencies very soon. This means that government agencies will be instructed to study the crypto market with the aim of creating a comprehensive regulatory framework.
On Feb. 17, Yahoo Finance’s Jennifer Schonberger, who is familiar with affairs within the Biden administration, revealed the injunction could arrive in the next week. Alongside the regulatory framework, she will urge authorities to commission a study on a central bank digital currency. The main agencies involved are the Ministry of Finance, the Ministry of Foreign Affairs, the Ministry of Justice and the Ministry of Homeland Security.
Also, the Director of the Office of Science and Technology Policy is to make a comprehensive technical assessment of things needed to support a digital central bank system. The focus is on creating the right infrastructure to support the digital dollar. The authorities should submit their report to the US President within 180 days.
On Feb. 16, Bloomberg News reported that the White House and US Treasury Department are not on the same page when it comes to crypto regulations. However, a Treasury official has dismissed this as “inaccurate”. The government is currently busy with a variety of efforts to regulate the crypto space. The FBI has also set up a crypto task force to deal with crypto scams.
Financial stability and cryptocurrencies are not opposites
One of the biggest challenges regulators face when using digital assets is the financial stability of the overall system. Under the forthcoming decree, the Financial Stability Board would consider this matter. Furthermore, the President’s Working Group has already asked the Council to examine the risks associated with the use of stablecoins.
Treasury Department Undersecretary Nellie Liang recently stated that the Senate is reviewing the risks posed by stablecoins. The Treasury Department remains hopeful that Congress will take action on the matter, given its limited powers and oversight authority of its own.
Additionally, the Attorney General, along with the FTC and the Consumer Financial Protection Bureau, will focus on the impact that growth in the use of digital assets may have on the financial system as a whole. At the same time, the SEC, CFTC, Federal Reserve Bank, FDIC and OCC will prioritize market protection measures in their respective jurisdictions.
The US government is reportedly working to coordinate with other government agencies around the world. The aim is to create standardized rules for cryptocurrencies and create a framework for their international use . All eyes will be on the executive order, which will also provide clarity to other nations on how the largest crypto market, the US, is approaching crypto regulation.