President Joe Biden signed an executive order on Wednesday calling the government to begin an investigation into digital currency to decide if it’s a good idea for the central bank to create its own cryptocurrency.
“My Administration places the highest urgency on research and development efforts into the potential design and deployment options of a United States CBDC,” the executive order reads.
The investigation will examine the influence of cryptocurrency on financial stability and national security.
U.S. acceptance and willingness to involve itself in the cryptocurrency world is also a competitive benefit against China which has outlawed cryptocurrencies.
“That will help position the U.S. to keep playing a leading role in the innovation and governance of the digital assets ecosystem at home and abroad, in a way that protects consumers, is consistent with our democratic values and advances U.S. global competitiveness,” Brian Deeseand Jake Sullivan, Biden’s top economic and national security advisers, said Wednesday in a joint statement.
One of the main issues the investigation will examine is the protection of customers. The executive order calls on the Treasury to outline policy recommendations and create protection from cyberattacks and other risks that come with a digital space.
Biden “has the opportunity to ensure America remains the global leader for technological innovation for years to come,” said a statement from Blockchain Association that represents top cryptocurrency companies.
One topic that the White House failed to address is stablecoins. Stablecoins present a heightened risk because they are digital tokens that take on the value of existing currencies, like the U.S. dollar or the Britain pound. Reports have come out that the tokens are not fully backed by money in reserve. United States Secretary of the Treasury Janet Yellen has made it clear that she hopes to see Congress layout regulation to address the issue.
Biden’s executive order comes as speculation have risen that Russia has been able to use cryptocurrency to survive the West’s sanctions on their economic sector after their invasion of Ukraine late last month.
