The Biden administration plans to release a comprehensive strategy on cryptocurrencies, consolidating the approach of several government agencies.
According to Bloomberg sources, several senior administration officials have already held multiple meetings on the plan. The executive order, which intends to put the White House firmly in the midst of cryptocurrency compliance, could be released as soon as next month.
The directive will likely task federal agencies with assessing the risks and opportunities that cryptocurrencies pose, including economic, regulatory and national security challenges. By the second half of 2022, the sources said, the White House will be expecting reports from various agencies. For instance, the Financial Stability Oversight Council plans to look at the possible systemic impacts of digital assets, while another government report will look at alleged illicit uses of the virtual coins.
The directive would also expand the regulation of crypto to other federal agencies, including the State Department and the Commerce Department. Among the regulatory roles carved out for them, some will be to ensure that the U.S. remains competitive in a world increasingly adopting digital assets.
One of the ways experts have weighed in on remaining competitive has been to develop a central bank digital currency (CBDC). At the moment, the administration has been holding off on taking a firm position, while the Federal Reserve is still considering the issue. Last week, the Fed released a preliminary paper, opening the subject to a public debate until May 20. Regardless of any results, the Fed said it would not move forward without the support of the White House and Congress.
Meanwhile, other countries around the world have been making strides in developing a CBDC to challenge private cryptocurrency growth. After several years of development and trials at several regional cities last year, the digital yuan will be unveiled for broader use at the Winter Olympics next month. Visitors will be able to download an app or receive a physical card storing digital yuan, which they can top up or exchange with physical banknotes at self-service machines.
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