For the last day or so I have been following the rumors/leaks coming out of the White House about crypto regulations. Even though the Federal Reserve CBDC report is only a few days old it seems that the White House wants to move while the iron is still hot. Congress has proposed and passed some things that deal with crypto and regulation however a lot of what has been done is asking for/requesting reports to be compiled from various government agencies.
In the most recent report that the US government has done and released, the Federal Reserve or Fed report, both within the report and publically the Federal Reserve has maintained its neutrality. I was caught off guard with this as I figured that would take a stance either pro or against it but rather they just kind of stayed in the middle. This report was honestly rather a letdown as it had been a very anticipated item.
Something that I did not expect to see or even hear about what the White House trying to make a cryptocurrency regulation move at this time. To be honest, there is a lot of stuff going on right now both internationally, internally, and financially with the country. However, if the reports coming out are deemed to be true and what has been discussed does in fact happen February will be a month unlike one I can remember for the crypto realm. What has been discussed is an Executive Order from the White House to set the US government's strategy and the economic, regulatory, and national security challenges of crypto and its underlying technology.
An underlying theme though is that the Biden Administration wants really every single government body that could be impacted or involved to weigh in like the Financial Stability Oversight Council and the U.S Department of Commerce. This move by the administration comes at a very interesting time with all of the stalled/failed agenda items that the administration is grappling with. During the last year or so CNBC has released multiple stories about the impact that crypto has had on the historically underbanked and those who struggle to make ends meet. Families across ethnic lines have stated how crypto has helped elevate them socioeconomically and there is considerable data showing that crypto has been a huge driving force in alleviating the socioeconomic gap faced not only in the US but worldwide.
Now these individuals who are being helped out by crypto are/were key voters for the Democratic Party in the 2020 elections. With the party struggling in the polls and mid-terms rapidly approaching the poll standing are becoming a larger and larger factor. It is interesting then to see this sector get targeted when it has benefitted so many. Over the next week or so I expect more will come out about this pending executive order and what it will all do. Reports are to be expected really at this point but what else it might entail is unknown.
There is one thing though that I feel is pretty much guaranteed to not happen and that is any actual regulation. Executive Orders legally speaking are hard to enforce and often will get tied up in court if they have any sort of consequence. What I assume the Admin is trying to accomplish is to serve as a springboard for legislation. To get all of the reports from all of the agencies so that the Admin can give some proposal to Congress to try and get passed. It could also be that they are looking for ways to tax these transitions but that is pure speculation. The big thing though is something is coming and reports are rumored to be wanted. Some type of framework will most likely then be made for some sort of new regulation of crypto.
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