White House issues its executive order on cryptocurrencies

[Hydrogen]

The Biden White House showed off a new executive order on Wednesday regarding the regulation of cryptocurrencies. The order essentially lays out a broad strategy for how the government plans to balance consumer protection while ensuring that the United States continues to be a space for innovation in the sector.

For those in the crypto sector concerned about aggressive government intervention, the order’s language seems to signal that the Biden White House is uninterested in sweeping near-term reforms and is instead merely focused on ensuring that agencies are on the same page in researching and observing the national security implications of the crypto industry.

“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,” a fact sheet issued by the White House reads.

The press release lays out seven major goals of the executive order with added detail:

• Protect U.S. Consumers, Investors, and Businesses
• Protect U.S. and Global Financial Stability and Mitigate Systemic Risk
• Mitigate the Illicit Finance and National Security Risks Posed by the Illicit Use of Digital Assets
• Promote U.S. Leadership in Technology and Economic Competitiveness to Reinforce U.S. Leadership in the Global Financial System
• Promote Equitable Access to Safe and Affordable Financial Services
• Support Technological Advances and Ensure Responsible Development and Use of Digital Assets
• Explore a U.S. Central Bank Digital Currency (CBDC)

While crypto investors may generally breathe a sigh of relief, fellow lawmakers like Elizabeth Warren who have been highly critical of the crypto space may be less satisfied. In recent months, Warren has criticized the industry, drawing particular attention to the environmental impacts of cryptocurrencies and the investor risks associated with lax regulation of so-called stablecoin issuers and other players in the DeFi ecosystem.

The White House’s communications regarding the EO largely seems to avoid calling out any particular coins or projectsm with the exception of noting the price volatility of Bitcoin specifically. There was no mention of particular verticals like DeFi or NFTs, either.

A particular concern among some in the crypto industry was that the potential use of cryptocurrencies by wealthy Russian elite to evade sanctions would prompt a crackdown, but one unnamed senior official on a background press call seemed to downplay this possibility. “I will say, on Russia, in particular, the use of cryptocurrency we do not think is a viable workaround to the set of financial sanctions we’ve imposed across the entire Russian economy and, in particular, to its central bank.”

A major focus of the order is formally directing several government agencies to begin researching the development of a state-backed cryptocurrency — a U.S. Central Bank Digital Currency (CBDC). “This research, along with the framework we will develop for international engagement and competitiveness, will help ensure we preserve the critical role of the United States in the global financial system,” a senior White House official said.

President Biden will sign the executive order today, the White House says.


https://techcrunch.com/2022/03/09/biden-white-house-issues-executive-order-on-cryptocurrencies/

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With american 2022 elections on the horizon, it is possible we won't see drastic measures regarding crypto regulation until june to november 2022 and later.

Given how republican states like texas and florida trend towards crypto friendliness. While democrat states like california and new york trend towards heavy handed authoritarian measures towards crypto, resembling china. It is likely that the bitcoin voting demographic will select republican candidates over democrats.

2022 United States elections

The 2022 United States elections will be held on Tuesday, November 8, 2022. During this midterm election year, all 435 seats in the House of Representatives and 35 of the 100 seats in the Senate will be contested. Thirty-nine state and territorial gubernatorial and numerous other state and local elections will also be contested. This will be the first election affected by the redistricting that will follow the 2020 census.

https://en.wikipedia.org/wiki/2022_United_States_elections

My personal feelings on this: I'm not a fan of anything Biden has done since he was sworn in as President. The best scenario here is for him to leave crypto alone and stay as far away from it as humanly possible.

If there is a big crackdown on crypto post 2022 elections, I wonder if we could see a big uptick in capital flight, with an elevated number of americans renouncing US citizenship to migrate abroad to enjoy reduced crypto taxes and regulation.

[1714483018]

1714483018

[stompix]

I've read the fact sheet too,  a whole bunch of nothing to be honest.

There is an article from axios which makes short of what those means:

State of play: With the executive order, Biden aims to create a national policy for digital assets by working with multiple agencies in tandem:

The Treasury Department is expected to come up with recommendations addressing consumer and investor protections.
Treasury is also asked to produce a report on the future of money and payment systems, assessing how big a role cryptocurrencies may have in it.
The Financial Stability Oversight Council is expected to identify economy-wide, systemic financial risks posed by crypto and offer up recommendations to address regulatory gaps.
The Commerce Department is asked to establish a framework that would leverage crypto technologies to reinforce U.S. leadership in the global financial system.
Finally, the order encourages the Federal Reserve to research the possible development of a U.S. central bank digital currency.

So, basically, it's all about recommendations to research and identify expectations to do something.
Compared to what that nutcase Warren was expecting to have in place this is, well, just a useless piece of paper.
Probably that's why everyone is so quiet on it, the whole thing is nothing until we see the result of those researches and studies that will of course take a few years to be completed, then a few more years to trigger some legislation changes.

[Beerwizzard]

My personal feelings on this: I'm not a fan of anything Biden has done since he was sworn in as President. The best scenario here is for him to leave crypto alone and stay as far away from it as humanly possible.

If there is a big crackdown on crypto post 2022 elections, I wonder if we could see a big uptick in capital flight, with an elevated number of americans renouncing US citizenship to migrate abroad to enjoy reduced crypto taxes and regulation.

They can't just leave crypto alone. Any disputes and any kinds of shit that come from crypto market are coming straight to the government. And they need to either ban crypto or create a framework that would help to cooperate with existing taxation or legal systems. If country is not banning crypto then you should 100% expect some regulation. In case with exec order, they are going the right way and since there is nothing serious there, we can expect that later everything remains calm and wouldn't be too strict with crypto.

P.S.
Here is a 2022 crackdown scenario: Bernie wins elections, the entire world's economy is getting fucked, USD is crashing down and during overall chaos people are buying DOGE

[merchantofzeny]

They just really can't leave it alone can't they? They always say it's to balance "security" with the interest to make money we know how that usually turn out (more ways to rip off people with fees/taxes).

Given how republican states like texas and florida trend towards crypto friendliness. While democrat states like california and new york trend towards heavy handed authoritarian measures towards crypto, resembling china. It is likely that the bitcoin voting demographic will select republican candidates over democrats.

I think this is the reason why they might delay any actual regulations to after elections. In general politicians avoid talking about taxes and the likes during campaign season since no one wants to hear that - it's a big turn off for voters.

If there is a big crackdown on crypto post 2022 elections, I wonder if we could see a big uptick in capital flight, with an elevated number of americans renouncing US citizenship to migrate abroad to enjoy reduced crypto taxes and regulation.

What's likely to happen. Crackdown and they just leave where they wouldn't have to pay as much. That's why tax havens developed to begin with.

[palle11]

This is about how much Biden wants to make out of this. For bitcoin is like the saying of , they don't like you yet they want to regulate how to benefit from what you offer. It is about tax generation from the use of bitcoin and cryptocurrency. I think Biden could have faced more issues at this time and not to wake an agenda likely to push Americans crypto enthusiast out in bid to run away from higher taxation.

[The Sceptical Chymist]

My personal feelings on this: I'm not a fan of anything Biden has done since he was sworn in as President. The best scenario here is for him to leave crypto alone and stay as far away from it as humanly possible.

I'm with you there, Hydrogen.  However, this executive order was probably not Biden's brainchild but the result of lots of input from bank lobbyists, the Fed, Biden's advisors, and who knows what other interests--I'm guessing Biden doesn't know all that much about cryptocurrency and has what passes for his presidential mind on a million other things, so there's no way he could have written this thing himself even if he had the time and inclination to do so.

And why is NY so crypto-restrictive?  I thought they were supposed to be the crypto center of the US, if not the world (I think I've heard statements to that effect in the past).  Believe me, I'm not arguing with what you said about NY and CA, because it's absolutely true.  I'm just wondering why NY in particular, which is home to Wall Street, won't even allow their citizens to use exchanges like Binance or even ShapeShift (do they even still exist?).  It's goddamn depressing.