President Donald Trump delivered on his campaign promise as he signed the executive order to transform the US into the global crypto capital. The executive order portrays a swift action toward delivering regulatory clarity whose absence has condemned the industry to operate in the gray area.
The order signed on Thursday, Jan. 23, aims to cement the US as the global leader in digital assets technology and artificial intelligence (AI). Additionally, the order bars the central bank’s digital currency (CBDC) issuance in the country, which saw GOP politicians criticize it as a pathway to privacy invasion.
Venture capitalist David Sacks, who Trump entrusted as the crypto and AI czar, witnessed the Oval Office event. The order is poised to facilitate the establishment of a working group to develop clear crypto regulations.
The signing of the executive order comes after much anticipation that Trump would deliver the pro-crypto promise upon his Monday, Jan. 20 inauguration. While the industry waited till Thursday, the order features a directive to create the national crypto reserve from the lawfully seized assets.
The executive order offers sweeping directives supporting the establishment of a comprehensive framework to bolster innovation. Additionally, it will eliminate the regulatory uncertainty behind the country’s surrender of crypto projects and talent to the crypto-friendly jurisdictions.
The proponents of this initiative profile it as a pathway to safeguard the country’s financial sovereignty. This order’s core provision delivers a formalized platform prohibiting the CBDC that Trump has repeatedly opposed during his campaign.
Creating Crypto Working Group
The central goal of this order is to establish the crypto working ground under the National Economic Council (NEC). The newly established committee will operate under the leadership of David Sacks.
The crypto czar must collaborate with other financial market regulators to harmonize the nation’s digital asset policies overhauling. Nonetheless, the working group must contend with the tight timeline, particularly the 30-day window, to identify regulations and guidance that hamper the crypto industry.
The order gives the working group a 60-day timeframe to issue recommendations on necessary repeals, amendments, and creation of new rules.
A six-month deadline is stipulated for the working group to formulate comprehensive crypto regulations that govern digital asset issuance and operations, including stablecoins. The initiative aligns with Trump’s campaign promise to eliminate regulatory ambiguity.
The absence of regulatory clarity in the US has been a long-standing frustration to the sector during the Biden-Harris administration and Gary Gensler’s tenure as SEC chair.
Is National Crypto Stockpile Next?
The noticeable element in the proposal is the stipulation to create the national crypto reserve. Notably, the digital asset stockpile is set to feature cryptos legally seized by federal law enforcement agencies.
The proposal offers a broader approach to the previously floated idea of a national Bitcoin reserve. Its current form stops short of BTC alone as it captures other US-developed altcoins to bolster digital asset adoption.
Several crypto purists opine that the broader focus on the altcoins dilutes the initial initiative. However, industry insiders reason that the recent move stems from increased lobbying efforts undertaken by various blockchain companies, particularly Ripple Labs, which has recently executed significant investments and strategic partnerships promoting its XRP token.
Anti-CBDCs Campaign
The executive order by Trump issued an unequivocal ban on the circulation and issuance of CBDC within the US territory. The firm stance extends the perceived threat that CBDC poses to personal privacy, financial instability, and national sovereignty.
Unlike cryptos such as XRP, Bitcoin, and SOL, CBDCs are primarily government-issued currencies that operate on private blockchains.
Critics warn that CBDCs could grant central banks amplified levels of monetary surveillance, allowing them to control how the holders spend their money. Trump’s stance contrasts with the approach of the Biden administration, which supported the initiative to explore CBDC development.
The departure from the pro-CBDC course leaves the US taking a back seat, unlike other 100 global competitors in various development phases. The executive order affirmed Trump’s stance on aborting such plans under his administration.
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Source: https://e-cryptonews.com/president-trumps-executive-order-to-shape-us-crypto-policy/