Critics argued that the Biden administration’s assessments were more concerned with the negative effects of cryptocurrency on the environment than with the positive aspects of the technology. After US President Joe Biden’s administration released a regulatory framework on digital assets, members of the crypto community and advocacy groups reacted, with many claiming the White House concentrated on the potential drawbacks of cryptocurrency.
The White House announced on Friday that nine reports had been submitted by federal agencies and departments in accordance with Biden’s executive order on cryptocurrency from March. The fact sheet includes details on goals for a digital currency issued by the U.S. central bank, methods to reduce the potential climatic impact of crypto energy use, regulatory objectives for enforcement actions, and guidelines for dealing with hazards.
The Treasury Department will submit a report by February 2023 on a “illicit finance risk assessment on decentralised finance,” according to the Biden administration, which also pledged that federal agencies would “continue to expose and disrupt illicit actors and address the abuse of digital assets.” The Federal Reserve planned to introduce FedNow-like payment systems around 2023, and the White House added that it would support them.
On Twitter, both the co-founder of MicroStrategy, Michael Saylor, and cryptocurrency analyst Dylan LeClair slammed the administration’s attitude, alleging that it was exploiting environmental concerns as an excuse to expand its control over digital assets.
According to Kristin Smith, executive director of the Blockchain Association in the United States, “today’s findings and summaries from the Biden administration’s executive order on digital assets represent a squandered chance to entrench U.S. crypto leadership.” These papers “concentrate on hazards — not opportunities” and omit significant recommendations on how the United States should promote its booming crypto business, despite the fact that they are intended to be part of a larger government and stakeholder effort to bring better regulation to crypto assets.
Sheila Warren of the Crypto Council for Innovation told Cointelegraph that the policy suggestions appeared to be founded on a “outdated and uneven knowledge” of cryptocurrencies, which might leave the specifics up to other politicians or the following administration:
“Many people were concerned about other nations surpassing the US during the hearing on crypto regulation yesterday. Enforcement-based regulation is not clear regulation. If we impose regulations, it also gives other nations a free hand to determine how the technology serves their interests, which may be in conflict with that of the US.”
The task is far from over, but the reports on creating a thorough regulatory framework for cryptocurrencies in the U.S. were some of the first ones necessary since President Biden issued the order in March. The effects of introducing a digital dollar will continue to be studied by the Fed and Treasury Department. The Financial Stability Oversight Council will release a report on the financial stability concerns of digital assets in October, according to the White House.