President Biden plans to issue an executive order next week that will require government agencies to begin assessing cryptocurrency and other digital assets. Additionally, the order mentions looking into the creation of a central bank digital currency. These assessments will provide a framework for the Biden Administration’s goal of regulating digital assets.
Multiple organizations are currently looking to increase their involvement within the crypto community and oversights, so this expected order will not come as a surprise to many.
The Biden Administration is looking to begin regulation efforts across multiple sectors, including the introduction of a new FBI unit, led and regulated by Eun Young Choi, a prosecutor with extensive experience handling computer-related crimes.
The Financial Stability Oversight Council (FSOC), which was formed to monitor system risks, will soon be directed to analyze any stability issues that may come from digital assets.
Nellie Liang, Treasury Undersecretary, has recently brought discussions within the senate regarding the use of stablecoins and the risks that they may pose. She is looking at what steps Congress can take toward their regulation and is hopeful Congress will act since there is little that can be done currently.
The Attorney General, FTC, and Consumer Financial Protection Bureau will be directed to analyze how cryptocurrency will affect market competition, and they will ultimately provide potential protection measures. Furthermore, the Department of Treasury, SEC, Commodities Futures and Trading Commission and federal banking agencies will be directed to devise a plan to protect consumers, investors, and businesses against digital asset risks.
The Science and Technology office will be directed to submit a report to President Biden on digital distributed ledger technology within 180 days and an update on its environmental effects within 545 days (about 1 and a half years).
The State Department, Treasury Commerce Department, and USAID will also plan to coordinate with agencies worldwide to develop a standardized system and rules for digital assets.
The expected order will provide a chance for the government to chime in on cryptocurrency and what risks it may pose. Ultimately, rules and regulations are likely to develop in the coming months as studies begin ramping up.