President Biden reportedly plans to sign an executive order this week to firm up the U.S. government's approach to cryptocurrencies. Analysts expect the order to provide guidance to multiple federal agencies in investigating possible regulatory changes for cryptocurrencies. The order is also expected to touch on national security and broader economic impacts of cryptocurrencies.
Reports of a potential order seeking to establish a central policy regarding cryptocurrencies previously circulated in January. At that time, reports suggested that federal agencies were assessing risks and opportunities related to digital currencies.
- President Biden is expected to sign an executive order this week regarding the U.S. government's strategy for digital currencies.
- The order, which has been in the works since 2021, reportedly will provide guidance regarding regulations, national security, and economic impacts.
- In recent weeks, industry executives have applied pressure on the White house over what they say is a lack of clarity regarding regulation.
What to Expect in the Cryptocurrency Executive Order
White House officials have so far declined to comment on a cryptocurrency executive order. Still, mounting external pressures suggest that the order may aim to address some issues in particular. First, analysts have raised concerns about the use of cryptocurrencies as a way of evading international financial sanctions such as those that the U.S. and allies levied against Russia following Russia's invasion of Ukraine.
More broadly, industry executives have voiced concerns about a perceived lack of clarity regarding the U.S. government's approach to regulating cryptocurrencies. The executive order is expected to begin to assign roles for government agencies relating to the regulation of crypto tokens. It will also likely require those agencies to provide updated reports about their plans later in 2022.
Potential News About a Central Bank Digital Currency
Additionally, the executive order may address a question that has long loomed over the cryptocurrency sphere: will the U.S. government issue its own central bank digital currency (CBDC)? As a growing number of countries around the world launch their own CBDCs, the question has become increasingly urgent.
However, it's likely that the order will not clarify the U.S. government's position on a potential CBDC at this time, because the U.S. Federal Reserve is still studying the implications of such a move. The Fed said in January that a CBDC could help to preserve the dominance of the U.S. dollar as cryptocurrency adoption booms on a global scale.