President Biden signed an executive order on March 9th, 2022 that outlines the first steps for Bitcoin and cryptocurrency regulations. With the rise in adoption and market size, the White House recognizes that Bitcoin, cryptocurrencies, and digital assets are becoming a major industry that may benefit U.S citizens.
The purpose of the Digital Assets Executive Order is to present a Federal Government strategy for ensuring the protection of consumers, providing financial stability, assessing national security, and addressing climate risks.
The Treasury Department and other agencies will assess the best course of action to be taken for the digital assets sector. As the industry grows and develops, these agencies will need to periodically update their policies for consumers, businesses, and investors. The policies will encourage regulators to adopt proper oversight and avoid any systemic financial risks that may be caused by digital assets.
US and global financial stability will be overseen by the Financial Stability Oversight Council. Their job is to mitigate any financial risks associated with digital assets by developing policies and recommendations. Meanwhile, other US government agencies will coordinate to focus on the mitigation of potential illicit financial and national security risks posed by the use of digital assets.
Also, the Department of Commerce will be responsible for developing a framework for increasing the United States’ competitive edge within global technology and financial systems in respect to digital assets.
But in order to compete in these realms, the appropriate government agencies will also help promote safe, affordable, and accessible financial services for all Americans. The Secretary of the Treasury will provide a report that includes: the future of money, payment systems, implications for economic growth, financial growth, inclusion, national security, and how digital assets may influence the future.
The executive order also announces plans to support technological advances in digital assets. Plans include necessary steps regarding the development, design, implementation, privacy, security, combating illicit exploitation, and reducing the negative climate impacts of digital assets.
Research and development for a potential U.S. CBDC will be a top priority for the U.S. Government. The appropriate agencies will evaluate the infrastructure needed for a CBDC in a way that is in the best interests of the American people. The Federal Reserve will continue researching the possibility of a U.S. CBDC and how to best develop it for national and international use.