President Joe Biden appears to be attempting to become a crypto buddy. After over a year in office, the 46th president has finally done something right by the crypt industry, drawing praise from almost all circles.
This month, the American President signed one of the most sweeping and widely acclaimed crypto regulation bills ever in the United States, marking a new dawn in the battle for legalization and legitimization.
Crypto Inclusion Comes Now
This month, President Biden signed an executive order on digital assets and their use within the United States. The order came following reports that the White House is now looking to take a more proactive role in regulating cryptocurrencies and fears that this might not be as favorable as many in the market expected. However, the language of the order was significantly positive, showing that the government might truly be willing to engage the industry.
As the executive order showed, the federal government is looking to engage crypto from several standpoints. These include financial stability, investor protection, financial inclusion, innovation, combating criminal activity, and preserving the United States’ status as the global financial leader.
The White House has designated the Treasury Department as the leading agency for building policy recommendations for managing possible cryptocurrency risks. It also assigned policy recommendations to the Financial Stability and Oversight Office, while the entire government will focus on combating illicit crypto activity and other matters of national security.
Besides addressing the possible risks of cryptocurrencies, the executive order also directs the Commerce Department to build a framework that ensures the United States’ ability to maintain competitiveness in the global digital asset space.
Lastly, the Treasury Department has also been tasked with producing a report on the ”future of money and payment systems.” It encourages the Federal Reserve to speed up research on a possible central bank digital currency (CBDC).
Rising Threats Forced The President’s Hand
There have been several pointers concerning what might have informed this executive order. China has already made significant strides towards building a CBDC, with the country already testing and running trials for its digital yuan for over a year now. The fallout from such an asset launching is yet to be known. Still, many industry experts have suggested that the United States will need to have a similar asset that can maintain the dollar’s global financial hegemony.
Another huge reason is the conflict in Ukraine. Ever since Russia invaded its neighboring country, the international community has been swift to hit sanctions on Russians - from President Vladimir Putin to several top Russian oligarchs and elites both home and abroad. Since then, there have been fears that the Kremlin could use crypto to evade these sanctions.
While there haven’t been any pointers yet of this happening, the possibility alone should be concerning enough. Hence, the executive order’s focus on national security and illegal activity. Whatever the reason is, there is no doubt that Biden’s order is coming at a great time for the industry.
Industry Leaders and Regulators React
For now, the executive order has been vague over what steps should be taken to improve crypto’s standing in the American economy. However, the reactions so far have been very positive.
Janet Yellen, the Treasury Secretary, explained in a statement that the order would do a lot to strengthen businesses and the economy while also mitigating any possible systemic risks posed by digital assets.
The Crypto Council for Innovation, a consortium of crypto firms including names like Gemini and Coinbase, described the executive order as a step in the right direction, claiming that it offers a “holistic and informed” approach towards cryptocurrencies. The group predicted that this would lead to better regulation and the inclusion of digital assets in the American economy.
“We look forward to working in partnership with regulators and policymakers in the coming months to develop smart policies that bolster America’s position as a global leader of crypto innovation. Collaboration is crucial,” the CCI said.
Jeremy Allaire, the CEO of crypto payment company Circle, also praised the executive order as the single biggest opportunity for crypto market insiders to engage with politicians and policymakers on real issues. “The proverbial doors of policymakers are WIDE OPEN, this is now a NATIONAL conversation in the U.S,” he added.
Now that crypto is making strides to become an integral part of the national economy, it will be interesting to see how this executive order improves the conversation and the actions that regulators will take based on the directives.