Executive Order Bolsters Crypto Regulations, Proposes Digital Asset Stockpile
President Donald Trump has issued an executive order addressing the cryptocurrency industry, fulfilling two campaign promises.
Key Developments:
* Establishes a presidential working group to develop a comprehensive regulatory framework for digital assets.
* Prohibits the creation of central bank digital currencies (CBDCs).
* Directs the working group to assess the potential establishment of a national digital asset stockpile, potentially including cryptocurrencies seized by federal law enforcement.
Analysis:
While the order does not authorize the immediate creation of a bitcoin stockpile, it signals a pro-crypto stance from the administration. The working group will evaluate the feasibility and criteria for such a stockpile.
Despite the absence of immediate concrete actions, market participants view the order positively. Sean Farrell, head of digital assets at Fundstrat, notes that the pro-crypto stance is significant for the industry's future.
Regulatory Framework:
The working group, chaired by David Sacks, White House AI and crypto czar, will identify existing regulations and make recommendations within 60 days. Within 180 days, it will submit a report with legislative and regulatory proposals.
Other Developments:
* The Securities and Exchange Commission (SEC) has rescinded accounting guidance that hindered banks and broker-dealers from holding crypto in custody.
* Coinbase Global CEO Brian Armstrong has advocated for a strategic bitcoin reserve, citing the government's gold holdings.
* Congressional approval may be required for further government purchases of crypto.
Outlook:
The executive order provides a framework for the administration to address cryptocurrency regulations and signals support for the industry. The working group's findings and recommendations will shape the regulatory landscape for digital assets in the United States.