Crypto EO
This morning the White House released the “Executive Order on Ensuring Responsible Development of Digital Assets.” Anticipation and subsequent relief in the community was demonstrated in this morning’s market pop. Before we even skimmed the news, beautiful green chart lines informed us that the Executive Order (EO) contained no hazardous materials for the crypto world.
The EO might be as good as it can be, which means it’s much better than expected. EOs are always wordy; many Presidents are often well-meaning windbags. Print Crypto will boil it down for the short attention span cryptoverse.
Overall thoughts:
Crypto twitter celebrated the EO’s lack of overanxious demand for regulation. There’s no hard policy. The EO is a position paper with a few due-outs for stakeholder agencies, rather than a list of thou-shalts. Overall theme - we need to get smart on this so a) no one gets hurt, and b) we don’t screw it up.
Somebody writing policy for the administration knows a little about crypto. The jargon is up to date, which is difficult even for those of us on the inside. No mention of WEN MOON or getting REKT, but no gaffes either. The fact that somebody knows enough to get the language right means that somebody on the inside probably owns some tokens and screws around on Sushiswap. Bullish.
There’s an underlying current of needing to get crypto regulation right to remain relevant. One of the policy objectives states, “Continued United States leadership in the global financial system will sustain United States financial power and promote United States economic interests.” We (the US) can’t miss the crypto train because we couldn’t come up with smart regulation. Again, pretty bullish.
The EO’s Policy Objectives are:
Protect consumers - safeguards and oversight without “arbitrary or unlawful surveillance.”
Protect United States and global financial stability - focused on regulating the overall ecosystem including “digital asset issuers, exchanges and trading platforms, and intermediaries”
“Mitigate the illicit finance and national security risks posed by misuse of digital assets.” (Working in national security for 25 years I can tell you that dollars remain the currency of the criminal realm.)
Stay Relevant - “we must reinforce United States leadership in the global financial system and in technological and economic competitiveness…”
Maybe the most exciting, here’s the humanitarian case for crypto, on a piece of paper with White House letterhead!
Many Americans are underbanked and the costs of cross-border money transfers and payments are high. The United States has a strong interest in promoting responsible innovation that expands equitable access to financial services, particularly for those Americans underserved by the traditional banking system, including by making investments and domestic and cross-border funds transfers and payments cheaper, faster, and safer, and by promoting greater and more cost-efficient access to financial products and services.
…Slow clap, right?! That had to have been written by a member of the tribe.
Finally a catch all for anything worrisome the paper hasn’t mentioned yet, including the only mention of mining, which is of course negative. “...reduce negative climate impacts and environmental pollution, as may result from some cryptocurrency mining.”
The remaining sections contain a deep dive on development of a Central Bank Digital Currency (CBDC) and assignments for Agency Heads.
The amount of thought in the CBDC section indicates that the administration understands that China took a big risk on their own CBDC and that we’re behind. There’s more meat in the CBDC discussion than in the regulatory section, which makes me think that the EO is more about kicking off a CBDC development process than finding ways to oversee Uniswap. The US CBDC is coming.
Finally, the EO devolves into tasking for many studies and reports, some due to the White House in three months, some due in a year, most looking for recommendations for potential legislative or regulatory actions. Take it from a DC guy, it’s really tough to orchestrate this level of government homework assignments. The EO doesn’t name a Crypto Czar or action team to manage the tasking or the resulting information, but requires the National Security Council system to run deliverables through the interagency process.
I know this all sounds like Beltway wonk, but trusting development of new crypto regulation to the established bureaucracy may indicate that if we play nice together and nobody gets hurt, this EO might satisfy the White House crypto appetite for the near future. Bullish
- By Andy Howell
Community & Policy Lead | Print Crypto, Inc
