As the White House has set out to etch out a U.S. Crypto Policy, the Biden Administration is all set to aim for the same via an executive order to be sent out in February. The executive order will ask for reports from federal agencies.
It will be the first of its kind, an initial government-wide strategy for digital assets. Federal agencies will be tasked to study the risks and opportunities.
Fed holds meetings to decide on a strategy
Senior administration officials are holding hectic parleys to plan an effective strategy for Digital Currencies. The blueprint is vague and ambiguous. However, experts feel that the Federal Reserve has taken the first tentative steps towards creating a CBDC. The hardest part is designing a CBDC that satisfies Congress and the White House while smoothly transitioning into the payment and banking systems without disruption.
The hard part will involve the Fed sorting through how to design a central bank digital coin (CBDC) in a way that meets the approval of both the executive and legislative branches. As a result, Fed officials are demanding ideally a specific authorizing law that will enable the framing of a Crypto policy.
US Congress open to CBDC
The Congress has been open to creating CBDC though the Fed will need to sort through details to satiate both parties. Meanwhile, the Senate Banking Committee Chairman Sherrod Brown (D-OH) hailed the Fed’s report as a positive step towards designing a central bank digital currency that will bring more Americans into our banking system. He added that he would look forward to working with Federal Reserve and the Biden Administration to ensure that workers, small businesses, community banks, and credit unions can continue to participate in the digital economy.
He was supported by Republican Senator Pat Toomey, a ranking Banking Committee member who called the step the acknowledgment that cryptocurrency is here to stay. The only concern which Senator Pat Toomey expressed was how the Fed would protect Americans’ privacy. The Fed has not revealed how it would preserve consumer transaction data. The Fed report also does not clarify if the CBDC would not allow direct peer-to-peer transactions.