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Biden Administration To Regulate Bitcoin, Cryptocurrencies Over National Security Concerns

The Biden administration is planning on Executive Order on the regulation of cryptocurrencies and bitcoin. According to various sources, the White House intends to establish a single set of laws to regulate bitcoin and cryptocurrencies, since the current legislation and enforcement is dispersed across sectors and departments.

Apparently, over the next few weeks, the White House is expected to issue an executive order declaring cryptocurrency regulation a matter of national security, which will raise the level of priority some federal agencies will have to give to their efforts to monitor crypto ecosystem. A national security memo is expected to be released in the coming weeks, Barrons said, according to a source familiar with the White House plan.

The Biden administration is preparing to release a government strategy to regulate cryptocurrencies as early as February as the market faces a deep debacle linked to uncertainty over the Federal Reserve’s fight against inflation. Now, the Biden administration is preparing to issue an executive order calling on federal agencies to regulate digital assets like Bitcoin, Ethereum and NFTs “for national security purposes,” the report said.

The administration will soon issue a National Security Memorandum obliging various federal agencies to create a common regulatory framework covering the entire industry, the source said. According to a Barrons report, President Biden will release a memorandum that directs certain government agencies to investigate and create a regulatory framework for cryptocurrencies, non-fungible tokens (NFTs), and stablecoins. According to a Barrons source, the White House will order government agencies to review digital assets, including cryptocurrencies, stablecoins and non-fungible tokens, in order to create a regulatory framework.

The regulatory effort will include the State Department, the Treasury Department, the National Economic Council and the Council of Economic Advisers, and the White House National Security Council, Barrons said.

The administration notes that cryptocurrencies have “financial implications.” According to Barrons, this order is subject to national security measures as the administration seeks to analyze cryptocurrencies and implement a harmonized regulatory framework covering bitcoin, cryptocurrencies, stablecoins and NFTs.

The move will also look at the impact of digital assets on financial stability and the normalization of cryptocurrency regulation in other countries. The US government has been paying increased attention to cryptocurrency regulation coupled with exploring the possibility of issuing a CBDC. However, the US is not alone in this matter, as many countries, such as Russia and India, are also working on ways to regulate the cryptocurrency sector.

The Biden administration has expressed intent to develop a coherent set of policies to regulate bitcoin and cryptocurrencies as current legislation and enforcement across the board is too sparse, arguing that the move is a matter of national security. Earlier this month, it was reported that the White House is preparing to issue an executive order on cryptocurrencies, with President Joe Biden allegedly asking federal agencies to identify the risks and opportunities associated with cryptocurrencies. The executive order, which could be signed by Biden next month, “will put the White House at the center of Washington’s anti-cryptocurrency efforts,” Bloomberg reported, citing unnamed people familiar with the matter.

Now, the Biden administration is preparing to issue an executive order that would ask federal agencies to regulate digital assets like bitcoin, ethereum, and NFTs “for national security purposes.” The Biden administration will order government agencies to propose cryptocurrency rules within weeks.

A key goal of the order is to develop a coordinated policy response from all agencies and departments of the US federal government. Washington also plans to lead efforts to ensure the consistency of digital asset regulation around the world. He explained that the work of state bodies needs to be coordinated with other allied countries that are currently working on the regulation of cryptocurrencies.

The document reportedly details the economic, regulatory and national security issues associated with cryptocurrencies, and requires reports from government agencies in the second half of the year.

The Treasury Department released a report on stablecoins, or digital assets pegged to currencies like the US dollar, calling for increased regulation in November 2021. Just last month, the US Congress held hearings on the regulation of stablecoins and disputes over the environmental impact of cryptocurrencies lasted only the last week. The gradual leak seems to have had little impact on the price of Bitcoin over the past 24 hours, but could become a sticking point later this year when the White House unveils how it plans to tackle cryptocurrencies.

El Salvador became the first country in the world to accept bitcoin as its fiat currency in September and started buying bitcoins. The IMF has asked El Salvador to declassify Bitcoin as legal tender, which the nation’s President, Nayib Bukele, denied.

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