The Biden administration is contemplating passing an executive order on cryptocurrencies, pushing for more crypto oversight. According to sources familiar with developments, the order would be part of a more comprehensive approach by the government and its branches regarding cryptocurrencies and other digital assets.
Federal Agencies To Offer Recommendations
The order would put federal agencies in charge of studying and offering recommendations on different areas regarding cryptocurrencies, such as financial regulation, economic innovation, and national security.
The initiative will also focus on coordinating all work on digital currencies throughout the executive branch, pushing different departments to give more attention to crypto. Government officials have also taken into consideration the appointment of a point-person in the White House for greater focus on the issue.
While the White House has declined to comment on the initiative, it is understood that the directive is part of a greater strategy on the regulation of digital currencies that have become wildly popular with the average American.
No Decision Yet
While no decision on the executive order has been made yet, it is speculated that even if the President does not move ahead with it, the Biden administration will be making its strategy for cryptocurrencies public.
Regulators have also started taking a hawkish stance when it comes to cryptocurrencies as they look to step up the regulation and federal oversight of crypto. They have also expressed concern at the lack of protection for investors and the risks to financial stability, with the crypto market growing beyond $2 trillion.
The additional scrutiny has also led to power struggles between agencies over which agency has jurisdiction over certain areas of the crypto market, especially areas that have seen significant growth.
Outlining The Responsibility Of Different Agencies
The draft also seeks to clearly outline the role and responsibilities of agencies and areas they are supposed to be looking into. The roles of the Treasury Department, Commerce Department, financial regulators, and other governmental branches will clearly be defined.
An official from the Biden administration stated that the ultimate goal of the White House is to approach crypto with a unified approach and not the ad hoc approach that the administration has taken until now.
No Clear Strategy Towards Digital Assets
Policymakers in Washington have struggled to craft a comprehensive strategy towards regulating digital assets such as cryptocurrencies. An example of the confusion can be found in the different stances taken by different regulators. The Securities and Exchange Commission has asserted that digital tokens come under its purview as they are investment contracts.
On the other hand, the Commodity Futures Trading Commission is keeping track of crypto derivatives, while the IRS and the Treasury Department’s Office of Foreign Assets Control also claim jurisdiction.
A Coordinated Effort
The push for increased crypto oversight is being coordinated by the White House, with the National Economic Council and National Security Council taking the lead. Daleep Singh, Deputy National Security Advisor and a veteran of the Federal Reserve Bank of New York and the Treasury Department, will be involved in the effort.
Tim Wu, the special assistant to the President for technology and competition policy, has significant knowledge in the crypto space but is recused as a conflict of interest arising out of his personal holdings in BTC and Filecoin.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.