After long-lasting rumors on the crypto crackdown, the White House seems to be taking the first concrete steps. The administration of the current president Joe Biden is expected to soon issue an executive order that may have a huge influence on the crypto market. The order would instruct the government agencies to initiate risk analysis on cryptocurrencies as a potential security threat to the country.
Biden’s Executive Order as a Part of Crypto Crackdown
Biden’s executive order is probably to be issued within a national security memorandum. The memorandum will assign some government agencies with the task of analyzing cryptocurrencies, stablecoins, and NFTs. The likely goal of the administration is to develop a functioning regulatory framework for the crypto market. The holistic investigation into crypto space is supposed to help the development of a set of policies and provide coherency to government efforts on this matter.
Will The White House Really Use An Executive Order On Crypto Assets?
The rumors on the potential executive order have intensified over the last couple of days. According to Forbes, the agencies involved are planning to issue their findings but the mid-2022. The reasoning behind putting crypto analysis under the umbrella of national security is that cryptocurrencies are used as a tool for transferring money across borders.
Blockchain Technology enables circumventing geo-specific rules and instruments of surveillance
Being decentralized, blockchain technology enables circumventing geo-specific rules and instruments of surveillance. This means that the government will likely try to get other countries involved and push for the development of international regulations. In addition, the fact that Biden’s administration views crypto as a national threat may be the reason for constant rejections of Bitcoin (BTC) spot ETFs.
Other Bills That May Influence Crypto Space
However, this is not the only piece of legislation worrying crypto investors. On Tuesday, House Democrats proposed the America COMPETES Act. One particular provision of the proposed bill raises most concern on the crypto market. The said provision states that the Treasury Secretary would be able the operation of crypto exchanges without any prior notice. The crypto proponents are concerned that this provision will not only have a disastrous effect on the crypto space but also on privacy and due processes in general. Basically, the special provision would give the Treasury Secretary unchecked power in controlling the crypto market.
Infrastructure Bill And Treasury Secretary Janet Yellen
At the same time, some legislators are trying to answer the pleas coming from the crypto industry. These lawmakers who support the crypto market are trying to fine-tune one already-passed bill. Biden-nominated Treasury Secretary Janet Yellen has been asked by the bipartisan group of congressmen to clarify the parts of the Infrastructure Bill that are related to crypto-assets. Passed in November, the Infrastructure Bill has some controversial parts pertaining to cryptocurrencies. Mainly, its definition of a broker is too broad as it also includes software developers, miners, node operators, and transaction validators.
What the bipartisan group is proposing is to narrow the definition of the broker. This would reduce the scope of what information the broker can obtain and use and prevent the opportunity to gain an advantage in transactions of digital assets. As currently defined by the Infrastructure Bill, some brokers have no way of verifying information on senders and receivers of crypto assets.