Will the Executive Order on Cryptocurrency Establish Financial and Technology Standards in other Countries?

Will the Executive Order on Cryptocurrency Establish Financial and Technology Standards in other Countries?

                                                                                                   

As a result of the invasion of Ukraine, lawmakers and the administration are concerned that Russia is utilising cryptocurrency to dodge sanctions imposed on its banks, oligarchs, and oil industry. On March 9, US President Joe Biden signed a first-of-its-kind executive order instructing government agencies to coordinate their efforts in developing cryptocurrency rules.

As previously reported, the Biden administration sees the rising popularity of Bitcoin as a demand to act rapidly to evaluate the risks and benefits of digital assets, according to a senior administration source who previewed the memo. This disclosure comes as some analysts predict that the Kremlin may be able to use crypto to circumvent Western sanctions.

Last year, it was reported that a number of federal agencies were studying the risks and opportunities presented by digital currencies, and senior administration officials had held a series of conversations on the subject, according to several persons familiar with the situation.

Around the same time, the Federal Reserve Board (FRB) released a discussion paper that examines the advantages and disadvantages of establishing a central bank digital currency (CBDC) in the United States, accessible for public comment through May 20. As part of the directive signed on March 9, the Treasury Department and other federal agencies will assess the impact of bitcoin on financial stability and national security. It's important to understand that the US government's efforts to regulate the crypto industry are focused on consumer safety, financial stability, illicit applications, global financial leadership, financial inclusion, and responsible innovation.

The executive order, which is the first of its kind to focus solely on the rapidly growing digital asset sector, directs federal agencies to better communicate their work in the industry, but it makes no specific recommendations. Similarly, there were no new rules that crypto firms had to observe in the directive.

However, lawmakers and administration officials were concerned that Russia is using cryptocurrency to circumvent the impact of sanctions imposed on its banks, oligarchs, and oil industry as a result of the invasion of Ukraine.

The finance industry, crypto traders, speculators, and lawmakers, who have compared the cryptocurrency market to the Wild West, were all anticipating the executive order, which was initially expected in October 2021.

According to the government, some 16 percent of adult Americans —or 40 million people — have invested in cryptocurrencies, with 43 percent of men between the ages of 18 and 29 having done so.

The focus of the executive order has long been assumed to be on national security, and the fact sheet detailing the order mentions it a few times. According to the reports, an administration official said the government has already started working on addressing these issues.

According to the reports, a government official stated that the government has already begun to solve these issues. The Department of Justice and the Federal Bureau of Investigation (FBI) both have relatively new offices dedicated to cryptocurrency-related offences, according to reports.

Most cryptocurrency networks are designed to make it more difficult to identify them and to make them more decentralised. The presidential directive "represents a continuation" of the US' efforts to set financial and technology standards in other countries, according to a source.

The US Commerce Department will be expected to design a framework to address concerns about crypto and ensure that America remains a leader in the usage of digital asset technology, according to the fact sheet provided with media. Other agencies should be able to build their own crypto policies or operational techniques using this platform.

The Treasury Department's financial literacy arm, on the other hand, indicated on March 8 that it would seek to develop consumer-friendly information to assist consumers "make informed decisions about digital assets."