The White House issued an executive order on March 9 relating to the responsible development of digital assets in the United States. This executive order outlines the first ever whole-of-government approach to both addressing the risks of digital assets and maximizing the potential benefits.
For the purposes of the executive order, the term “digital assets” refers to all central bank digital currencies irrespective of the technology used and to “other representations of value, financial assets and instruments, or claims that are used to make payments or investments, or to transmit or exchange funds or the equivalent thereof, that are issued or represented in digital form through the use of distributed ledger technology.”
The executive order sets out national policy to be implemented for digital assets across the following six areas of priority:
- Ensure consumer and investor protection:
- Developing policy recommendations to address the implications of the growing digital asset sector and changes in financial markets for consumers, investors, businesses, and equitable economic growth
- Ensuring safeguards are in place to promote the responsible development of digital assets in order to (1) protect consumers, investors, and businesses; (2) maintain privacy; and (3) protect against arbitrary or unlawful surveillance
- Promote financial stability:
- Encouraging the Financial Stability Oversight Council to identify and mitigate those risks posed by digital assets that have economy-wide consequences
- Understanding how new uses of digital assets can create economic risk and developing policy recommendations to address any gaps in the regulation
- Prevention of illicit finance:
- Directing an unprecedented focus of coordinated action across all relevant US government agencies to mitigate the risks of digital assets being used to aid in money laundering, cybercrime and ransomware, narcotics and human trafficking, and terrorism and proliferation financing, as well as a tool to circumvent US and foreign financial sanctions regimes
- Setting up appropriate controls for current and future digital assets systems to promote high standards for transparency, privacy, and security
- Endorse US leadership in the global financial system and economic competitiveness:
- Working across the US government with the Department of Commerce to drive US competitiveness and leadership in and leveraging of digital asset technologies
- Introducing standards across the industry that promote democratic values; the rule of law; privacy; the protection of consumers, investors, and businesses; and interoperability with digital platforms, legacy architecture, and international payment systems
- Encourage financial inclusion:
- Promoting access to safe, affordable, and accessible financial services, particularly in communities that have long had insufficient access to financial services
- Promote responsible innovation:
- Taking steps to support technological advances that engender the responsible development, design, and implementation of digital assets, while prioritizing privacy and security, combating exploitation, and reducing negative climate impacts that can result from cryptocurrency mining.
The assistant to the president for national security affairs as well as the assistant to the president for economic policy will coordinate the executive branch actions to give effect to the executive order.
Additionally, the secretary of the treasury will produce a report on the future of money and payment systems, including implications for economic growth, financial growth and inclusion, national security, and the extent to which technological innovation, such as digital assets, may influence the future.