The Biden White House showed off a new executive order on Wednesday regarding the regulation of cryptocurrencies. The order essentially lays out a broad strategy for how the government plans to balance consumer protection while ensuring that the United States continues to be a space for innovation in the sector.
For those in the crypto sector concerned about aggressive government intervention, the order’s language seems to signal that the Biden White House is uninterested in sweeping near-term reforms and is instead merely focused on ensuring that agencies are on the same page in researching and observing the national security implications of the crypto industry.
“The rise in digital assets creates an opportunity to reinforce American leadership in the global financial system and at the technological frontier, but also has substantial implications for consumer protection, financial stability, national security, and climate risk,” a fact sheet issued by the White House reads.
The press release lays out seven major goals of the executive order with added detail:
- Protect U.S. Consumers, Investors, and Businesses
- Protect U.S. and Global Financial Stability and Mitigate Systemic Risk
- Mitigate the Illicit Finance and National Security Risks Posed by the Illicit Use of Digital Assets
- Promote U.S. Leadership in Technology and Economic Competitiveness to Reinforce U.S. Leadership in the Global Financial System
- Promote Equitable Access to Safe and Affordable Financial Services
- Support Technological Advances and Ensure Responsible Development and Use of Digital Assets
- Explore a U.S. Central Bank Digital Currency (CBDC)
While crypto investors may generally breathe a sigh of relief, fellow lawmakers like Elizabeth Warren who have been highly critical of the crypto space may be less satisfied. In recent months, Warren has criticized the industry, drawing particular attention to the environmental impacts of cryptocurrencies and the investor risks associated with lax regulation of so-called stablecoin issuers and other players in the DeFi ecosystem.
The White House’s communications regarding the EO largely seems to avoid calling out any particular coins or projectsm with the exception of noting the price volatility of Bitcoin specifically. There was no mention of particular verticals like DeFi or NFTs, either.
A particular concern among some in the crypto industry was that the potential use of cryptocurrencies by wealthy Russian elite to evade sanctions would prompt a crackdown, but one unnamed senior official on a background press call seemed to downplay this possibility. “I will say, on Russia, in particular, the use of cryptocurrency we do not think is a viable workaround to the set of financial sanctions we’ve imposed across the entire Russian economy and, in particular, to its central bank.”
A major focus of the order is formally directing several government agencies to begin researching the development of a state-backed cryptocurrency — a U.S. Central Bank Digital Currency (CBDC). “This research, along with the framework we will develop for international engagement and competitiveness, will help ensure we preserve the critical role of the United States in the global financial system,” a senior White House official said.
President Biden will sign the executive order today, the White House says.
https://techcrunch.com/2022/03/09/biden-white-house-issues-executive-order-on-cryptocurrencies/....
With american 2022 elections on the horizon, it is possible we won't see drastic measures regarding crypto regulation until june to november 2022 and later.
Given how republican states like texas and florida trend towards crypto friendliness. While democrat states like california and new york trend towards heavy handed authoritarian measures towards crypto, resembling china. It is likely that the bitcoin voting demographic will select republican candidates over democrats.
2022 United States electionsThe 2022 United States elections will be held on Tuesday, November 8, 2022. During this midterm election year, all 435 seats in the House of Representatives and 35 of the 100 seats in the Senate will be contested. Thirty-nine state and territorial gubernatorial and numerous other state and local elections will also be contested. This will be the first election affected by the redistricting that will follow the 2020 census.
https://en.wikipedia.org/wiki/2022_United_States_elections My personal feelings on this: I'm not a fan of anything Biden has done since he was sworn in as President. The best scenario here is for him to leave crypto alone and stay as far away from it as humanly possible.
If there is a big crackdown on crypto post 2022 elections, I wonder if we could see a big uptick in capital flight, with an elevated number of americans renouncing US citizenship to migrate abroad to enjoy reduced crypto taxes and regulation.
