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The long-awaited executive order on cryptocurrencies from the White House is finally out. It details how the industry can reinforce the US, as well as its citizens, the need for risk mitigation, as well as outlining a few critical points for regulators to work on.
President Biden’s Executive Order on Cryptocurrencies
This has long been a hot topic throughout the cryptocurrency community, and, finally, the statement is out. As it turns out, the market responded very favorably to the news.
The document recognizes the growth of cryptocurrencies over the past few years and also outlines how it can benefit US authorities and the country’s citizens.
The rise in digital assets creates an opportunity to reinforce American leadership in the global financial system and at the technological frontier, but also has substantial implications for consumer protection, financial stability, national security, and climate risk.
As a priority, the document says that the US “must maintain technological leadership in this rapidly growing space, supporting innovation while mitigating the risks for consumers, businesses, the broader financial system, and the climate.”
The six key priorities that the US national policy should focus on include: “consumer and investor protection, financial stability, illicit finance, US leadership in the global financial system and economic competitiveness, financial inclusion, and responsible innovation.”
US Central Bank Digital Currency?
In addition to all of the above, the document also poses a possibility for the US to explore a Central Bank Digital Currency (CBDC), acknowledging that over 100 countries have already done so.
The Order directs the US Government to assess the technological infrastructure and capacity needs for a potential US CBDC in a manner that protects Americans’ interests. The order also encourages the Federal Reserve to continue its research, develompent, and assessment efforts for a US CBDC.
In conclusion, the document revealed that the US Administration will also continue to work with agencies and with Congress to deliver actionable policies that protect investors and guide responsible innovation.
Market Responds Favorably
The broader cryptocurrency market responded very favorably to the news and gained upwards of $130 billion in a matter of hours.
Commenting on the matter was also Gabor Gurbacs, Director at VanEck, who summarized the document:
It largely promotes studies and oversight but also aims to support innovation and strategic leadership to further the national interest. Seems net positive for the industry. – He said
Jeremy Allaire. the CEO and Co-Founder of USDC issuer Circle delivered a thread on the matter, saying that this is a “watershed moment for crypto” while also comparing the order to when the government woke up to the commercial internet back in 1996 and 1997.
White House Exec Order and U.S. Government Strategy for Digital Assets — a thread with thoughts; TLDR = this is a watershed moment for crypto, digital assets, and Web 3, akin to the 1996/1997 whole of government wakeup to the commercial internet. (1/7)
— Jeremy Allaire (@jerallaire) March 9, 2022