The White House has released a new framework that encompasses a plethora of findings on digital assets, which includes stopping illegal uses of it, climate change effects, as well as how Federal agencies should move forward with regulations and guidelines.
The framework comes after President Biden signed an executive order (EO) in March entitled ‘Ensuring Responsible Development of Digital Assets.’ The EO looked to better understand some of the effects of digital assets.
The first-ever digital assets framework is the result of nine reports from agencies that “articulate a clear framework for responsible digital asset development and pave the way for further action at home and abroad.”
It outlines the risks of cryptocurrencies and how consumers can be adversely affected by the recent instability that has plagued cryptocurrencies in recent years. The Biden administration has recommended that Federal agencies investigate how consumers and investors can be best protected from market schemes.
“The reports encourage Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC), as appropriate, to redouble their efforts to monitor consumer complaints and to enforce against unfair, deceptive, or abusive practices,” the White House fact sheet said.
The framework also encourages the Department of Treasury (DOT) to help with facilitating traditional financial institutions to create regulatory guidelines for digital assets.
“The Treasury and financial regulators are encouraged to, as appropriate, provide innovative U.S. firms developing new financial technologies with regulatory guidance, best-practices sharing, and technical assistance,” the White House said.
The White House made various recommendations in the following areas with the specific way Federal agencies should move forward:
- Protecting consumers, investors, and businesses;
- Promoting access to safe, affordable financial services;
- Fostering financial stability;
- Advancing responsible innovation;
- Reinforcing our global financial leadership and competitiveness;
- Fighting illicit finance;
- Exploring a U.S. central bank digital currency (CBDC).
The push for government entities to consider digital assets in a more serious light comes as 16 percent of Americans own digital assets and as crypto assets at one point reached a $3 trillion market capitalization.