White House Releases Bitcoin, Crypto Regulatory Framework
The White House has published a legal framework for engaging with bitcoin and cryptocurrencies in the US following President Joe Biden’s “whole of government” executive order (E.O.) earlier this year, according to an official press release.
“Ensuring Responsible Development of Digital Assets” E.O. It urged government agencies to produce a variety of research related to consumer privacy and protection, energy consumption, and central bank digital currency (CBDC) benefits and risks.
In line with the research provided, the White House intends to empower the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) to “aggressively investigate” the digital asset space.
In addition, Biden’s administration will press the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) to “redouble their efforts to monitor” the ecosystem related to “unfair, deceptive or abusive practices.”
However, it is unclear what enables these agencies to determine whether they will initiate monitoring for the aforementioned malicious behavior.
Continuing, the framework also calls on agencies to adopt “instant payment systems” like FedNow and begin considering regulating non-bank payment providers.
Additionally, the National Science Foundation (NSF) will conduct research on “technical and socio-technical issues and behavioral economics” to understand the digital asset ecosystem.
Following a recent report by the White House Office of Science and Technology Policy (OSTP), the Department of Energy (DoE) and the Environmental Protection Agency (EPA) are tasked with “tracking the environmental impacts of digital assets; developing performance standards as appropriate; and providing local authorities with the tools, resources and expertise to reduce environmental harm.
In addition, the Bank Secrecy Act will be amended to apply to digital assets, leading to heavy fines for unlicensed money transfers and stricter enforcement of digital asset service providers.
Also, the U.S. The Treasury Department will complete the risk assessment as it relates to Decentralized Finance (D-Fi).
Finally, Biden’s administration has developed “Strategies for the U.S. CBDC System,” which details the government’s priorities as it relates to the issuance of digital dollars. However, the publication states that “further research is needed”.
Agencies selected to lead an ongoing task force on CBDC research and potential development include the Federal Reserve, the National Economic Council, the National Security Council, the Office of Science and Technology Policy, and the Department of the Treasury.