What is Biden's Executive Order on Crypto about?

Welcome to the cryptohunt jam where we spend one minute a day to explain crypto. In plain english.

Today, let's take a deeper look into US President Biden's executive order on crypto and what it means.

An executive order is a written instruction the US President can give to all of the federal agencies he has control over. It's called an executive order, because it is not a law - but it instructs agencies to interpret existing laws in certain ways, which can have significant impact in practice.

One such area is cryptocurrencies. In its order, the Biden administration made a first attempt to clear the path for rules around when and how they are legal to use.

And that is important. To date, rules mostly exist around taxation, but not around how to build and market crypto projects. But the crypto industry might become a major economic factor in tech, and without clear rules, companies may decide to go elsewhere. Large exchanges like FTX have already left the US and gone to Hong Kong for example. Other companies like Coinbase have long advocated for clear laws and rules instead of unknowns.

So what exactly does the order include?

First, it acknowledges that crypto is a major trend. But as a government, a balance has to be found between allowing legal innovation and protecting consumers. Take stable coins as an example - many are not as stable as they promise, and there is nobody to protect you from that today. Another important factor mentioned is the protection of the environment.

Second, the order encourages the agencies to continue their research into a "digital dollar" - which could be a sort of crypto currency controlled by the US government.

And lastly, because crypto can be so complicated, it also asks the attorney general to determine if the existing agencies are actually capable of handling a crypto future - or if the creation of a new entity, entirely focused on the topic, is necessary.

All this is encouraging for crypto innovation in the United States. But remember - this is only an exploration of what could be. Laws will still have to be written and passed.

Disclaimer: This podcast references our opinion and is for information purposes only. It is not intended to be investment advice. Do your own research and seek a duly licensed professional for investment advice.