President Joseph Robinette Biden Jr. recently signed an executive order in the United States to ensure “Responsible Development of bitcoin payments.” This is the first time an entire government has taken a step toward regulating cryptocurrency activities. The main points of focus are:
- Protection for the consumers and investors
- Preventing illicit finance
- To bring financial stability and risk assessment
- U.S. leadership and competitiveness
- Innovating responsibly
- financial inclusion
The abovementioned order is essential to establishing a comprehensive federal approach to securing digital assets. Based on the orders of federal government, multiple regulatory steps and issues must be taken in to consideration in regards to the digital assets. It was ordered while not prescribing any regulatory framework or requiring any issuance of new rules. All the laws and regulations resulting from such reports and recommendations will constantly be subjected to the act for Administrative Procedure, which allows ordinary people to submit their comments.
The Key Features
- All the agencies involved and the treasury departments are told to issue recommendations to help address the investors and the consumers for their protection.
- The treasury department is also asked to come out with a report on the future of the different payment systems and the future of money. The information should also include all the conditions that will drive the adoption of all sorts of the digital asset.
- One of the most important goals of regulating cryptocurrency is to identify systemic risks in all economies posed by crypto.
- The Department of Commerce is also ordered to establish a framework that will help to leverage all crypto technologies, which will eventually help reinforce U.S. leadership in the Global Financial System.
- Lastly, the final order of the regulation was made to the Federal Reserve, which is to encourage them to keep up with the research and documenting of the possible development of CBDC, the U.S. central bank digital currency.
- This will also include the necessary consequence of the strategy, which will evaluate all the essential requirements and the steps needed towards the potential implementation and eventually the launch of a U.S. central bank digital currency.
Cryptocurrency Banking And Exchange Regulations
In January 2022, several U.S. government agencies conducted a “crypto sprint” to determine whether additional cryptocurrency regulations were required. After the sprint, they released a roadmap outlining some policy areas where they intend to conduct further research and possibly issue new rules. 4
These are the steps discussed that were discussed:
- Custody of cryptocurrency assets
- Bank’s sales of cryptocurrency assets
- The Issuance of stablecoins
- The use of different cryptos as collateral for loans from banks
- The additional rules for keeping crypto on a balance sheet
The order directs tasks across a broad range of government agencies and offices. Now the financial regulators will play a vital role in the participation of all the other regulators, and the officials will demonstrate all the issues that the different cryptocurrencies will present to the U.S. policy. The topics vary widely from economic competitiveness to the national security.
Now the regulation directly directs the President’s assistant for National security affairs and the President’s assistant for monetary policy, which will help coordinate the actions the executive branch will carry out through the interagency process. CFPB, FTC, SEC, CFTC, FDIC, OCC, and the Federal Reserve will call for attending the interagency meetups. You can check out Bitcoin Prime for more info.
Whatever happens, the USA’s regulations will continue to impact the market and all of us as investors and customers. Therefore, keeping up with the development is the best thing to do in the situation. When you’re too busy monitoring the market for cryptos and trying to make the best investments, it’s easy to overlook the effects of regulation. However, rules can significantly impact both you as an investor and the market.
Before we end this article, it is pertinent to mention that the U.S. regulations concerning cryptocurrency have affected not only the country as a whole but all the countries across the globe. The government significantly impacts the other country’s dealings with cryptocurrency. However, cryptocurrency is a market in itself; specific governmental provisions can affect it diversely; still, it is not likely that its existence will be hampered by any means.