As a result of the announcement of President Biden’s highly anticipated executive order on digital assets, cryptocurrency prices rose Wednesday.
As of last night, Bitcoin was trading at $41,944, around 8% higher, according to Coin Metrics. ETH was also significantly higher.
The executive order addresses the lack of a framework for U.S. cryptocurrency development, and the industry and investors have generally supported it. According to critics, the lack of regulatory clarity could hold the U.S. back when it comes to cryptocurrencies, allowing the rest of the world to leapfrog ahead. In addition to regulatory uncertainty, institutional adoption of Cryptocurrency has also been cited as a barrier.
Travis Kling, CEO of Ikigai Asset Management, said: “The Cryptocurrency ecosystem is fundamentally bullish over all timeframes.” In summary, “It’s easy to forget how much ground this ecosystem has covered in the last two years in regards to legitimacy and stance from the US government. This order is clear evidence that the U.S. government is not banning Cryptocurrency, it embraces it.”
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Additionally, the order outlines measures to protect consumers, investors, businesses, and to mitigate systemic risk to the U.S. and global financial system.
In addition, the bill asks the U.S. government to examine “the technological infrastructure and capacity requirements for central bank-issued digital currencies.”
“A coordinated and comprehensive approach to digital asset policy,” Treasury Secretary Yellen said in a statement on Wednesday.
The executive order begins an examination of the crypto industry by all regulatory agencies with jurisdiction over the industry over the next six months. CNBC’s “Crypto World” reported Wednesday that it is possible that regulatory agencies may propose specific policy proposals after seeing the results of the study and investigation after six months.
The downside of this analysis is that the government may recommend regulations that are more stringent than the Cryptocurrency industry can handle. This could result in innovation moving overseas, she said.
According to Smith, this will not be the case across the board.
She said, “There’ll be plenty of opportunities for us to engage.” With more education about the industry, policymakers are much more open to what we consider to be reasonable policies in the industry.”.