“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,” reads the announcement. “The United States 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.”
According to the White House, survey data suggests close to 16% of adults in the U.S. have used, traded or invested in cryptocurrency. The market cap of the assets has jumped from $14 billion just five years ago to more than $3 trillion in November.
From Twitter
"BREAKING: US Senator @SenLummis readying the Responsible Financial Innovation Act. A bill that will help move the #Bitcoin industry forward in the USA."
Biden’s order focuses on six distinct priorities for creating a holistic and comprehensive digital asset strategy. Those priorities are as follows, per the announcement:
- Consumer/investor protection
- Illicit finance
- Financial stability
- Financial inclusion
- U.S. financial leadership and economic competitiveness
- Responsible innovation
The order also calls for the U.S. to explore the creation of a Central Bank Digital Currency and calls for placing “urgency” on the necessary research and development of a state-backed digital asset.
“President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy. This approach will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses,” said U.S. Secretary of the Treasury Janet Yellen. “It will also address risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.”
Partnering with the Department of Treasury to protect investors and consumers is among some of the many provisions in the order. The department, along with other relevant agencies, is being asked to develop policy recommendations to address digital assets’ growing popularity and public acceptance.
The order also encourages the Financial Stability Oversight Council to identify and mitigate systemic risks and address potential regulatory gaps in crypto policy, directs “unprecedented focus of coordinated action” to mitigate illicit activities and national security risks associated with digital currency, encourages the Department of Commerce to develop a framework to “drive U.S. competitiveness,” promotes equitable access to financial services and supports the responsible development of digital assets.
“The Administration will continue work across agencies and with Congress to establish policies that guard against risks and guide responsible innovation, with our allies and partners to develop aligned international capabilities that respond to national security risks, and with the private sector to study and support technological advances in digital assets,” concludes the order.
