Janet Yellen Says Biden’s EO to Aid ‘Responsible Innovation’ in Crypto

Key Insights:

• Janet Yellen lays out how her department will implement the provisions of Biden’s EO.
• The order would focus on a coordinated and comprehensive approach to digital asset policy.
• Interagency collaborations could be critical to the approach.

US Treasury Secretary Janet Yellen has released a new statement on President Joe Biden’s executive order regarding digital assets. It underlines how her department will implement the provisions of the long-awaited executive order.

Pushing Responsible Innovation

Yellen calls for efforts to support innovation while addressing risks associated with the growing asset class.

The statement issued on March 9, a day earlier due to some technical glitch, was later removed from the department’s website; however, the archived version captures the statement.

The document shares undisclosed early insights into the details of President Biden’s much anticipated executive order on digital assets.

According to the release, the order would focus on a ‘coordinated and comprehensive approach to digital asset policy.’

Yellen’s statement further noted that the executive order could ‘result in substantial benefits for the nation, consumers, and businesses.’

The statement said,

“Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy. This approach will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses.”

It further stated,

“It (the EO) will also address risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.”

Interagency Collaboration and Partnership

According to Yellen’s statement, the Treasury would ‘partner with interagency colleagues’ to produce a report on the future of money and payment systems.

The same could mean that the regulators would learn to understand digital assets like Bitcoin, Ethereum, and altcoins and how to regulate them within the framework of the EO.

Yellen’s department will also ‘convene the Financial Stability Oversight Council to evaluate the potential financial stability risks of digital assets and assess whether appropriate safeguards are in place.’

The statement also said,

“Because the questions raised by digital assets often have important cross-border dimensions, we’ll work with our international partners to promote robust standards and a level playing field.”

Thus, the EO could address the volatile nature of digital assets and form frameworks to help customers evade the risks associated with the same.

In hindsight, it is notable that President Biden has been working on an executive order related to digital assets since January. For now, industry reactions to the US government’s stance on digital assets are mixed.

While some experts think that the EO could be bullish for the larger market’s trajectory, others believe it could bring a slew of regulations to the space.