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Journalists learned of White House plans to speed up development of cryptocurrency regulation

Journalists learned of White House plans to speed up development of cryptocurrency regulation

The administration of U.S. President Joe Biden will instruct federal agencies to analyze digital assets and prepare an appropriate regulatory framework for national security interests. Barron's writes about it, citing knowledgeable sources.

According to the source, the White House will release an executive order in the "next few weeks" that will require the agencies involved to examine cryptocurrencies, steblecoins and NFTs. The act would affect the State Department, the Treasury Department, the National Economic Council and the Council of Economic Advisers.

"The initiative seeks to comprehensively examine digital assets and develop a set of rules that will give consistency to the government's actions in this space," he said.

Barron's source stressed that the memorandum is likely to affect the U.S. National Security Council because of the cross-border nature of cryptocurrency transactions, the latter pose relevant risks.

The president's administration will give the agencies involved three to six months to prepare proposals. The White House will act as coordinator.

Bloomberg analyst Eric Balchunas said the administration's initiative is consistent with his theory that the SEC is rejecting applications for spot bitcoin ETFs at the behest of higher authorities. 

In fact, you could reverse this and look at the seemingly head-scratching denial of what is clearly a good way to invest in crypto (vs using futures or CEF) was a foreshadow to a broader crypto crackdown. At least that's one theory we threw out there in June. pic.twitter.com/IkfRI9z78U & ; Eric Balchunas (@EricBalchunas) January 27, 2022

In his opinion, the release of the memorandum would be good news for the market:

"Ironic, but it's probably good news in terms of the potential approval of the controversy, as the Biden administration is going to release an executive document in the next few weeks stating what they want as a regulatory framework. That should clear the way for a spot bitcoin ETF."

Bloomberg previously reported that Biden intends to unveil a statewide strategy for digital assets in February 2022. The agency said that federal agencies will be tasked with assessing the risks and opportunities of cryptocurrencies.

The organization to promote and protect the interests of the cryptocurrency industry Coin Center also drew attention to another bill that could negatively affect the development of the industry. 

On January 25, the U.S. House Committee on Science, Space and Technology introduced America COMPETES Act of 2022. The Coin Center pointed out that the document in its current form would give the Secretary of the Treasury the right "to block any cryptocurrency transactions through financial intermediaries without any process, rulemaking or time limit for prohibition.

2/ The so-called "special measures" provision (proposed by @jahimes) would essentially give the Treasury Secretary unchecked and unilateral power to ban exchanges and other financial institutions from engaging in cryptocurrency transactions. How would it do this? pic.twitter.com/f3tVow9nxA & ; Jerry Brito (@jerrybrito) January 26, 2022

"The so-called 'special measures' provision would give the Secretary of the Treasury unchecked and unilateral power to prohibit exchanges and other financial institutions from participating in cryptocurrency transactions," Coin Center Executive Director Jerry Brito wrote.

He explained that the head of the Treasury already has the power to block accounts that he believes may be involved in money-laundering operations. However, in order to do so, he must notify the public and give them an opportunity to comment. In addition, the blocking period cannot exceed 120 days.

The document as presented removes these restrictions. According to Brito, the bill will be passed "in one form or another."

Recall that the U.S. Financial Services Industry Regulatory Service will consider a potential tightening of cryptocurrency trading rules.

The SEC also warned of increased oversight of the digital asset market.

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