According to the Reuters report, this week President Joe Biden is expected to sign an executive order outlining the US government’s strategy for dealing with cryptocurrencies, citing people close with Biden’s plans.
As the threat of cryptocurrencies being used for criminal purposes becomes more apparent, the Biden administration is under pressure to clarify regulations on digital assets. Industry leaders have lobbied the White House in recent weeks over what they say is a lack of clarity on regulation.
To this end, President Biden is expected to sign an executive order this week on the US government’s digital currency strategy. The legislation, which will take effect from 2021, will provide guidance on regulation, national security, and economic impact. The executive order is expected to begin assigning roles to government agencies regarding the regulation of cryptocurrency tokens. It may also require agencies to provide an updated report on their plans later in 2022.
The growing external pressure suggests that the ordinance may be aimed at addressing some specific issues. First, analysts have expressed concern about the use of cryptocurrencies as a means of evading international financial sanctions, such as those imposed on Russia by the US and its allies following its invasion of Ukraine.
In addition to the US, countries such as Singapore and the European Union have pledged to take steps, some of which are expected to go beyond existing legislation, to prevent Russia from using cryptocurrencies to evade sanctions in the event of attacks.
Potential News About a Central Bank Digital Currency
In addition, the Executive Order may answer a long-standing question in the crypto-currency space. This concerns the issuance of the US government’s own central bank digital currency. As more and more countries around the world launch their own CBDCs, this question becomes more pressing.
However, the order is unlikely to clarify the US government’s position on a potential CBDC at this time, as the Fed is still considering the impact of the decision. The Federal Reserve said in January that CBDCs could help maintain the dollar’s dominance as crypto-currencies exploded around the world.