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Some time in the next few weeks, president Joe Biden will issue an executive order directing federal agencies to assess the risks and opportunities that Bitcoin, cryptocurrencies, stablecoins, and NFTs present to their operations, according to Bloomberg.
“This is designed to… bring order to the haphazard approach that the government is now using to regulate crypto [and] look holistically at digital assets and develop a set of policies that give coherence to what the government is trying to do in this space,” an unnamed person familiar with the plan told Barron’s.
“Because digital assets don’t stay in one country, it’s necessary to work with other countries on synchronization,” the person said.
Currently, crypto is regulated in some ways by the U.S. Securities and Exchange Commission and also by the Commodities Futures Trading Commission but with little coordination or coherence between them.
Key agencies involved in the analysis will include the state and treasury departments, the National Economic Council, the Council of Economic Advisers, and the National Security Council because digital assets have “economic implications for national security,” Barron’s said.
TREND FORECAST:As we wrote in “SEC Push to Regulate Crypto” (7 Dec 2021), the SEC permitting Bitcoin ETFs, which it did last October, was the crucial step that legitimizes U.S. oversight and regulation of other cryptocurrencies.
Before the end of this year, a regulatory structure to govern digital currencies will be ready for Congress to consider.
Despite objections from some Republican politicians, which we sampled in “Regulator Calls for Few Rules on Cryptocurrencies” (15 Jun 2021), the U.S. Congress will move toward enacting a regulatory framework.
Other nations that have not already done so will then follow the U.S. lead. And as we have forecast, the tighter the government restrictions on crypto’s the lower their prices will fall.