The Biden administration is said to be drafting an executive order outlining a government-wide cryptocurrency strategy. The directive is expected to be presented to U.S. President Joe Biden in the coming weeks, with the plan seen to be suit as early as next month.
Based on multiple reports, senior administration officials have held meetings to discuss the plan, which is being drafted as an executive order. The directive establishes the White House as the focal point of Washington's efforts to address cryptocurrencies.
Federal agencies have been studying and advising on the digital asset sector for years.
The Securities and Exchange Commission (SEC), the Office of the Comptroller of the Currency (OCC), and the Commodity Futures Trading Commission (CFTC) have issued guidance letters and notices of proposed rulemaking to direct how various aspects of the crypto industry should comply with federal law.
However, none of these efforts have been centralized in a single document or by a single agency.
The order will emphasize the economic, regulatory, and national security risks that digital assets pose. It will direct various federal agencies to weigh in on their assessments of the risks and opportunities associated with cryptocurrencies. They will be required to submit reports in the second half of this year.
The Financial Stability Oversight Council, for instance, will assess the potential systemic impact of digital assets. Another report will examine the cryptocurrency's illicit uses.
Additionally, the Biden administration is expected to comment on the possibility of the Federal Reserve issuing its own digital currency (CBDC). The Federal Reserve released a long-awaited report on CBDC on Thursday and extended the public comment period until May 20.
Federal agencies have taken a piecemeal approach to digital assets in recent years, and Biden's team is under pressure to take a leadership role on the issue.
Industry executives frequently lament what they perceive to be a lack of clarity regarding U.S. rules, while others fear that China's and other nations' embrace of government-backed coins could endanger the dollar's dominance.
Certain individuals have expressed concern that the United States is falling behind other countries, most notably China, in developing a central bank digital currency.
The Biden administration's increased emphasis comes at a time when consumer interest in the volatile cryptocurrency market is at an all-time high.
Bitcoin, the world's largest and most popular cryptocurrency, fell below $37,000 on Friday, compared to a November high of nearly $69,000.
