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Joe Biden is dipping his toes into crypto. On Wednesday, the president signed a first-of-its-kind executive order outlining a path to regulation of cryptocurrencies and encouraging federal agencies to study the creation of a U.S. digital dollar on the blockchain. Bitcoin’s price surged in the glow of the president’s attention.
The order, titled “Ensuring Responsible Innovation in Digital Assets,” calls for a “whole-of-goverment” approach to analyzing the risks and benefits posed by the financial technology and to considering legislation that would “address any regulatory gaps.”
“The rise in digital assets creates an opportunity to reinforce American leadership in the global financial system and at the technological frontier, but also has substantial implications for consumer protection, financial stability, national security, and climate risk,” the White House said in a statement.
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The White House cited the recent “explosive growth” in digital assets and emerging digital currencies in other countries as key factors for moving forward with the order now. Some 16% of U.S. adults have already invested or traded in cryptocurrencies. The order lays out six main priorities—“consumer and investor protection, financial stability, illicit finance, U.S. leadership in the global financial system and economic competitiveness, financial inclusion, and responsible innovation.” Notably, Biden also called for the exploration and study of a potential digital U.S. dollar currency operated by the U.S. Central Bank.
Though the order strongly encourages regulatory bodies to work together to draft new consumer protections, it punts on offering any specific recommendations.
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“The United States must maintain technological leadership in this rapidly growing space, supporting innovation while mitigating the risks for consumers, businesses, the broader financial system, and the climate,” the White House’s statement reads.
The order drew immediate praise from Treasury Secretary Janet Yellen, who has previously spoken critically about crypto, at one point calling Bitcoin an “extremely inefficient” way to conduct transactions.
“President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy,” Yellen said in a statement. She said Biden’s approach would address “risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.”
SEC Chair Gary Gensler, who has described the cryptocurrency sector as the “wild west,” also voiced his approval for the order.
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Bitcoin’s price surged more than 8% on Wednesday morning in response to the announcement, according to Reuters, a sign of the industry’s interest in some form of U.S. government strategy. Ethereum saw similar gains.