President Joe Biden is expected to sign an executive order on cryptocurrency this week that will mark a major step in the United States’ regulation of digital assets, according to Bloomberg.
The move comes amidst mounting concerns surrounding Russia’s use of cryptocurrency to dodge the impact of financial sanctions resulting from its invasion of Ukraine.
Treasury secretary, Janet Yellen, said: “We will continue to look at how the sanctions work and evaluate whether or not there are liquid leakages and we have the possibility to address them. I often hear cryptocurrency mentioned and that is a channel to be watched.”
Closer to home, America’s finance and industry executives have been calling on Washington to lay out a more direct approach to digital assets in a sector that is currently murky at best.
Last year, Biden said he was considering an investigation into the crypto sphere as part of an executive order to deal with the growing threat of cybercrime.
This appears to have developed into a sweeping overview of the regulatory role government agencies could play with digital assets and a consideration for the legality of a US central bank digital currency (CBDC).
The order is expected to ask the State Department to ensure US crypto laws align with those of its allies and call upon the Financial Stability Oversight Council to investigate illicit finance concerns.
Biden will also ask the Justice Department to look at whether a new law is required to create a digital currency, whilst the Federal Trade Commission and other entities will study the possible impacts on consumers.
Whilst a firm stance on the rollout of a CBDC remains unlikely for now, the Federal Reserve issued a paper on the topic in January that highlighted how it could maintain the superiority of the dollar in global markets. There are also concerns that it is necessary to remain competitive with China and other nations that are already piloting digital currencies to the public.
The order is expected to study the environmental impacts of crypto mining and the future technical infrastructure that digital assets could require as well.
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