The Biden Administration has revealed a roadmap that it plans on using to tackle the various risks associated with the proliferation of cryptocurrencies and digital assets.
In a new announcement, Biden’s officials say they have spent the “past year identifying the risks of cryptocurrencies and acting to mitigate them using the authorities that the Executive Branch has.”
The officials that the various events of 2022 underscore the need for a cohesive strategy to keep tabs on crypto, including the implosion of Terra () and the high-profile collapse crypto exchange FTX.
The Administration says that it has assembled experts to lay out the “first-ever framework for developing digital assets in a safe, responsible way while addressing the risks they pose.”
The officials also say that government agencies are ramping up enforcement where appropriate, without naming any specific firm or coin.
“The banking agencies issued joint guidance, just this month, on the imperative of separating risky digital assets from the banking system. Agencies across government have launched – or are now developing – public-awareness programs to help consumers understand the risks of buying cryptocurrencies. We encourage regulators to continue these efforts, including those designed to address and limit financial institutions’ exposure to the risks of digital assets.”
The White House recommends that mainstream institutions, such as pension funds, not be given the green light from Congress to “dive headlong” into crypto assets. While the Administration concedes that it supports innovation in the realm of financial services, safeguards first need to be in place.
“The Administration wholeheartedly supports responsible technological innovations that make financial services cheaper, faster, safer, and more accessible. Yet to realize these benefits, new technologies need commensurate safeguards. Safeguards will ensure that new technologies are secure and beneficial to all – and that the new digital economy works for the many, not just the few. To put the right safeguards in place, we will keep driving forward the digital-assets framework we’ve developed, while working with Congress to achieve these goals.”
