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The White House release Cryptocurrency regulatory framework based on President Bidens previous Executive Order.
The framework is a joint effort of several federal agencies and provides several recommendations for standardizing cryptocurrency regulation, cryptofraud crackdowns, and the financial services industry.
CNBC report A joint statement by National Economic Council Director Brian Deeds and National Security Advisor Jake Sullivan said the guidelines would make the United States a world leader in regulating digital assets.
This framework refers to the potential of the Digital Dollar, the US Central Bank’s Digital Currency (CBDC) project.
According to the report, such innovations can bring significant benefits, such as creating more efficient payment systems and laying the groundwork for technological innovation.
The Framework states that CBDCs can promote financial inclusion and equity by enabling broad consumer access.
The framework expresses concerns about digital assets and how they are intertwined with traditional financial markets, which could lead to economic instability due to contagion.
The framework noted how Terra’s ecosystem crash showed how the industry impacted the broader financial system.
Stablecoins need more regulation, according to the report, and the U.S. Treasury Department should enhance its ability to work with financial institutions to identify and mitigate cyber vulnerabilities.
The framework also addresses how malicious players use crypto for illegal activities and the need to eradicate this activity. It added:
Digital assets are fueling the rise of ransomware cybercriminals. Drug sales and money laundering for drug lords. And funding the activities of rogue regimes.
According to the framework:
The President has asked Congress to amend the Bank Secrecy Act, the Data Loss Prevention Act, and the Act Prohibiting Unauthorized Money Transfers, to apply explicitly to digital asset service providers, including digital asset exchanges and non-fungible token (NFT) platforms. We will consider whether to ask for
The Treasury Department report also recommends that more regulation is needed in the crypto sector.
Treasury Secretary Janet Yellen Said:
(The) report and its recommendations provide policymakers with a strong foundation as they work to realize the potential benefits of digital assets and mitigate and minimize risks.
