Earlier this week, the crypto space got a follow up from the White House for its Executive Order for Ensuring Responsible Development of Digital Assets, which President Baiden signed in March. The order asked the US government to conduct thorough research and analyze the crypto assets. Following the report that stated how crypto assets will be functioning within the country, The White House has now published a number of reports that were filed by the federal departments in response to President Joe Biden’s executive order on crypto.
The Crypto space has been growing exponentially and the introduction to newer projects along with some big upgrades like the Ethereum Merge, and Cardano Vasil Hard Fork is only adding to the increasing interest in the space.
The Narrative of the Federal Reports and Why it Matters:
The White House, Treasury, Commerce and Justice departments have published a few documents on Friday in response to the Executive order signed by Biden back in March. After looking at every aspect of the digital asset, starting from crypto’s role in illicit finance to analyzing the different considerations around a central bank digital currency all of the reports came out simultaneously.
All of these reports are interesting but not necessarily promising in terms of concrete action. According to CoinDesk news, the reports are largely summaries of the past events along with some analyses of certain ongoing research. The reports have also shared some recommendations for future action, however with no timeline or commitment. Moving on from the understanding of what is in the reports, this step towards analyzing the asset does indicate some real progress in terms of how the federal government is looking at approaching the crypto ecosystem and its regulations. Besides including an emphasis on central bank digital currencies (CBDC), there are a lot of other aspects that the crypto industry should be paying attention to in the reports.
White House Fact Sheet
The White House has published a “first-ever comprehensive framework for responsible development of digital assets.” According to the crypto community in general, the term “framework” does not imply a set process that the administration can take forward. Moving on from that, there are a lot of sessions within the fact sheet that, if the White House follows through, will result in dramatically reshaping how crypto companies are currently operating in the U.S. The biggest indicator for this is the mention of “federal framework to regulate nonbank payment providers.” in one of the treasury reports. Following what the statement implies, this would mean that there may soon be a federal regulatory framework set in place, which will not require crypto companies to take separate licenses for every state they operate out of.
The US Department of Justice:
Unlike most of what the report states, the Justice Department has a clear, enforcement-focused view in its report for digital assets. The first part dives into crypto and its role in illicit finance, noting that “crypto is also the payment method of choice for ransomware and other digital extortion activities.” according to the report published. Other than the newer inclusions there is not a lot of new pointers. The report mostly recaps the laws for those who do not follow Justice’s activities in the crypto space.
The US Department of Commerce:
Moving onto the Commerce Department’s report; it concentrated in looking at how the U.S. could remain competitive in the digital asset sector. To comprise the whole report, what the Department of Commerce report concluded, called for “effective regulatory approaches,” which also includes international and public-private engagement, along with more technological research and development.
White House Office of Science and Technology:
The White House science office, the department that made comments earlier this month by taking a step to criticize aspects of the crypto mining industry’s energy usage, published a report on some of the technical considerations for a digital dollar.
US Treasury’s Report on Consumer Considerations:
The Treasury report dived also analyzing what the crypto assets might mean for the general American public, who were referred to as, “consumers, investors and businesses.” The current primary use case for the crypto assets are to trade, lend or borrow other cryptos, with some other limited activities, the report said. However, the report further went to acknowledge that there may be some other activities that the crypto assets may look into in the future.