President Biden signed an executive order which directs federal agencies to coordinate their approaches to the crypto sector.
The Executive Order on Ensuring Responsible Development of Digital Assets does not specify how agencies should act or what regulations the administration wants to impose. Still, it does direct the Treasury Department to prepare a report on the “future of money,” an explanation of why the current financial system does not meet consumer demand.
The executive order represents the first attempt to regulate the cryptocurrency industry at a broader level, and it aims to address key areas like consumer protection, financial stability, illicit activity, U.S. competitiveness, financial inclusion, and responsible innovation. Additionally, the Biden administration is mulling how the U.S. can issue a digital dollar.
”Growing development and adoption of digital assets and related innovations, as well as inconsistent controls to defend against certain key risks, necessitate an evolution and alignment of the United States Government approach to digital assets,” as per the executive order.
Notably, the executive order, which was originally slated to go into effect in October 2021, does not mention stablecoins. This is strange because U.S. authorities assailed stablecoins, comparing them to “poker chips.” However, Treasury Secretary Yellen has already stated that Congress should introduce regulations in this area.
The order also focuses on the impact of crypto mining on the environment since it consumes a lot of power. It said crypto innovation could be made more “responsible,” reducing the effects of climate change. It also mentions some interesting statistics about American crypto investors, noting that about 40 million Americans, or 16% of the total population, have reported investing in or trading cryptocurrencies.
In general, the latest order is neutral and more consumer-oriented. While the order lacks specifics on how crypto regulations would work in the country, it has certainly reached the base camp — and is on its way to conquering the mountain.