Crypto and the edge of power
The blockchain and cryptocurrency community saw an historic moment last week when US President Joe Biden signed an executive order on cryptocurrencies.
We’ve known for some time that the White House has been investigating cryptocurrencies, yet nobody was certain if this would help or hinder this technology. However, the executive order shows that cryptocurrencies are being taken seriously. It is no longer an underground technology only accessible by those who ‘get it’ but is now recognised as a disruptive technology – one that has massive implications to current banking and payment systems and the international economy.
The executive order details what government agencies need to develop in respect to regulation and policies on how digital assets are traded and governed. But now is not the time to rejoice and celebrate, thinking that Satoshi Nakamoto’s vision will be fully realised. We aren’t sure how this order will manifest, but it is a step in the right direction.
Here’s a breakdown of the six policy objectives that are covered in the order:
Consumer, investor and business protection
US and global financial stability
National security risks and AML/CFT compliance
Financial and technological competitiveness
Financial inclusion
Responsible and sustainable innovation
The order also issues an assessment into the potential of developing a Central Bank Digital Currency (CBDC). This can allow for cryptocurrencies to become integrated with current banking and payment systems.
As the United States is a powerhouse across the global economy, this first step to issuing regulations can open innovative potential to digital assets and the emergence of Web3. This executive order shows that cryptocurrency is being taken seriously by those at the seat of power; it’s a reminder that it is pertinent that New Zealand does not miss the opportunity to be a leader of the pack.
Last year, the Reserve Bank of New Zealand released an issues paper on the Future of Money – Central Bank Digital Currency that discussed the potential benefits, opportunities, as well as challenges of digital assets and the prospect of introducing a stablecoin. BlockchainNZ submitted a thorough response to this issues paper, which you can read here.