According to a report by Reuters, US President Joe Biden will sign an executive order on Wednesday forcing the government to study the dangers and advantages of establishing a central bank digital dollar, as well as other cryptocurrency concerns.
According to Biden’s directive, the Treasury Department, the Commerce Department, and other important departments would be required to write reports on “the future of money” and the role that cryptocurrencies will play.
Widespread regulation of the cryptocurrency market, which surpassed $3 trillion in November, is critical to maintaining US national security, financial stability, and competitiveness, as well as combating the rising threat of cybercrime, authorities said.
Analysts see the long-awaited executive order, which was first reported on Monday, as a harsh recognition of cryptocurrency’s rising importance and the possible consequences for the US and worldwide financial institutions.
One of its primary provisions requires the United States Government to study the technological infrastructure required for a prospective U.S. Central Bank Digital Currency (CBDC) – an electronic equivalent of dollar notes in your pocket.
The Federal Reserve of the United States sent the topic of whether the country should adopt a digital currency to Congress in January, prompting analysts to estimate that such a project would take years.
However, one official stated that the United States will proceed with the development of a digital dollar, but with caution given the dollar’s status as the world’s principal reserve currency.
“We’ve got to be very, very deliberate about that analysis because the implications of our moving in this direction are profound for the country that issues the world’s primary reserve currency,” the official said.
The directive also pushes the Federal Reserve to maintain R&D initiatives.
