White House Eyes Creation Of a Digital Dollar In ‘First-Ever’ Crypto Framework

Please fol­low and like us:
Pin Share

The US is edging closer to developing a central bank digital currency (CBDC) after six months of research into the cryptocurrency industry. But the White House’s ‘first-ever’ comprehensive framework for the responsible development of digital assets has been criticised for ‘kicking the can down the road’.

Back in March, Pres­i­dent Joe Biden issued an exec­u­tive order (EO) call­ing on mul­ti­ple agen­cies – Depart­ment of Trea­sury, Com­merce, Jus­tice and the White House Office of Sci­ence and Tech­nol­o­gy Pol­i­cy – to do a ‘deep analy­sis’ of dig­i­tal assets’ risks and opportunities.

This has result­ed in nine reports out­lin­ing cryp­tocur­ren­cy impacts on finan­cial mar­kets, the envi­ron­ment, inno­va­tion and oth­er ele­ments of the eco­nom­ic system.

Togeth­er they ‘artic­u­late a clear frame­work for respon­si­ble dig­i­tal asset devel­op­ment’ call­ing on agen­cies to pro­mote inno­va­tion by kick­start­ing pri­vate-sec­tor research and devel­op­ment while mit­i­gat­ing the down­side risks.

The reports also ‘recog­nise’ the poten­tial ben­e­fits and risks of a US CBDC – or dig­i­tal dol­lar – and encour­age the Fed­er­al Reserve to con­tin­ue its ongo­ing CBDC research, exper­i­men­ta­tion, and eval­u­a­tion. It calls for the cre­ation of a Trea­sury-led inter­a­gency work­ing group to sup­port the Fed­er­al Reserve’s efforts.

Reg­u­la­to­ry and law enforce­ment agen­cies are also urged to col­lab­o­rate to address acute dig­i­tal assets risks fac­ing con­sumers, investors, and businesses.

The framework development

Bri­an Deese, direc­tor of the Nation­al Eco­nom­ic Coun­cil, said: “The respon­si­ble devel­op­ment of dig­i­tal assets is vital for Amer­i­can inter­ests, from the well­be­ing of con­sumers and investors to the safe­ty and sta­bil­i­ty of our finan­cial sys­tem, and for our finan­cial and tech­no­log­i­cal lead­er­ship around the world.

“We’ve seen in recent months sub­stan­tial tur­moil in cryp­tocur­ren­cy mar­kets, and these events real­ly high­light how, with­out prop­er over­sight, cryp­tocur­ren­cies risk harm­ing every­day American’s finan­cial sta­bil­i­ty and our nation­al security.

“And it is why this admin­is­tra­tion believes that now more than ever pru­dent reg­u­la­tion of cryp­tocur­ren­cies is need­ed if dig­i­tal assets are going to play a role that we believe they can in fos­ter­ing inno­va­tion and sup­port­ing our eco­nom­ic and tech­no­log­i­cal competitiveness.”

The Biden admin­is­tra­tion has said it will take the fol­low­ing steps:

  • US agen­cies will lever­age US posi­tions in inter­na­tion­al organ­i­sa­tions to mes­sage US val­ues relat­ed to dig­i­tal assets. US agen­cies will also con­tin­ue and expand their lead­er­ship roles on dig­i­tal assets work at inter­na­tion­al organ­i­sa­tions and stan­dard-set­ting bodies
  • The State Depart­ment, the Depart­ment of Jus­tice (DOJ), and oth­er US enforce­ment agen­cies will increase col­lab­o­ra­tion with—and assis­tance to—partner agen­cies in for­eign coun­tries through glob­al enforce­ment bodies
  • The State Depart­ment, Trea­sury, USAID, and oth­er agen­cies will explore fur­ther tech­ni­cal assis­tance to devel­op­ing coun­tries build­ing out dig­i­tal asset infra­struc­ture and services
  • The Depart­ment of Com­merce will help cut­ting-edge US finan­cial tech­nol­o­gy and dig­i­tal asset firms find a foothold in glob­al mar­kets for their products.
The reaction

Accord­ing to Sheila War­ren, CEO of cryp­to advo­ca­cy group Cryp­to Coun­cil for Inno­va­tion, the White House’s announce­mentseems to kick the can down the road’.

War­ren says: “We don’t see clear rec­om­men­da­tions. Those we do see seem to have an out­dat­ed and unbal­anced under­stand­ing of the tech­nol­o­gy. This is sur­pris­ing giv­en the clear instruc­tions from the EO and work from Mem­bers of Con­gress to move things forward.

Reg­u­la­tion by enforce­ment is not reg­u­la­to­ry clar­i­ty. If we reg­u­late by enforce­ment, it also gives oth­er coun­tries a clear run­way to fig­ure out how the tech works for their inter­ests, which may be con­trary to the US’s. In the hear­ing yes­ter­day, lead­ers seemed wor­ried about oth­er coun­tries over­tak­ing the US.

“We know there is more to come as pol­i­cy­mak­ers grap­ple with this com­plex and nuanced space. The Cryp­to Coun­cil will con­tin­ue to pro­vide input and help where we can. Con­nect­ing the inno­va­tors, builders and gov­ern­ment lead­ers is key for next steps.”

Source link

Please fol­low and like us:
Pin Share

Leave a Reply

Your email address will not be published.