In a daring move that could influence how cryptocurrencies are managed in the United States, President Donald Trump has ordered the formation of a new working group that will help write new regulations for digital currencies such as Bitcoin and Ethereum, it was announced Thursday. The move is a significant change of the U.S. government’s position on digital currencies, coming a day after Trump’s inauguration.
Businesses and individuals would also be able to use digital assets better if the new working group proposes a set of rules. That has included ensuring that the crypto companies have access to banking services, something the industry has repeatedly said has been a hurdle. Trump’s order also discouraged the creation of a central bank digital currency (CBDC) in the U.S. that might compete against current cryptocurrencies.
The president was a vocal supporter of digital assets previously and even referred to himself as the ‘crypto president’ while on the campaign trail. This is one of the first executive orders making good on his promises to buck the support of the cryptocurrency industry in the U.S. It is viewed as a response to the previous administration’s more careful attitude to checking the major crypto exchanges Coinbase and Binance for allegedly flouting U.S. laws.
Creation of a National Stockpile of Digital Assets
Creation of a national stockpile of digital assets is one of the most important elements of Trump’s new plan. This government would have legally seized cryptocurrencies in this stockpile. The theoretical idea is that these digital assets can help the government to maintain the economy during the periods of cyberattacks or other financial crises. However, it would make the U.S. better prepared to deal with emergencies involving digital currencies.
Crypto industry arguments that the U.S. should have more clearly defined rules for crypto, however, have been met with excitement. You can see how many regard the new regulations as one possible step reinforcing cryptocurrencies as more mainstream currency and more widely accepted. The order was described as a ‘sea change’ for US digital asset policy by Nathan McCauley, chief executive of crypto company Anchorage Digital. It will bring much needed clarity and consistency to an industry, he reflects.
The SEC’s Efforts to Simplify Crypto Asset Handling
Apart from the new crypto laws, the Securities and Exchange Commission (SEC) just made a significant move to allow crypto asset companies to handle crypto assets much easier. The SEC had earlier lifted old accounting rules that had made it costly for companies to warehouse digital assets for others. This is another great victory for the crypto industry, eliminating one of the barriers for broader adoption.
Formation of the New Working Group
Top officials such as that of the Treasury Secretary alongside the heads of the SEC and the Commodity Futures Trading Commission will be part of the working group that will draw up the new crypto regulations. But their ambition is to craft a framework that shows how companies, banks and regulators can manage them. This would help the U.S. sustain its leadership role in the world digital economy.
Concerns and Optimism Surrounding the Stockpile Plan
Even so, some are alarmed by the possibility of a national stockpile of cryptos while others are optimistic the plan could work. Assets are volatile, and while security is a concern, there is also a matter of theft. Managing these risks will have to be done carefully by the experts for the initiative to succeed.
Conclusion: A Big Policy Shift for the U.S.
All in all, Trump’s call to establish a new working group and explore a national digital asset stockpile demonstrates a big policy shift in America’s attitude toward digital currencies. If successful, America could be a leader in the digital economy.
Also read: Eric Trump Teases Zero Taxes on U.S. Crypto to Strengthen Blockchain Industry
