The long awaited executive order on cryptocurrencies by United States President Joe Biden is finally here.
Biden is expected to sign a highly anticipated executive order this week directing the Justice Department, Treasury and other departments to study the legal and economic implications of creating a U.S central bank digital currency and implementing oversight of the cryptocurrency market.
However, U.S Treasury Secretary Janet Yellen accidentally made public a day early details of how the Treasury plans to respond to Biden’s executive order.
Ms Yellen’s statement said that the executive order could “result in substantial benefits for the nation, consumers, and businesses.”
According to deVere Group CEO Nigel Green, Biden’s nod on cryptocurrencies in the US will reveal the real value of Bitcoin and digital money.
“For me, there are three key takeaways from Biden’s crypto executive order,” Green said.
“First, digital currencies are an inevitability in the ever more digital world that we live in. When tech is driving the way we live, work, do business and much more besides, it makes sense to have money that runs on tech too.
“Also, it must be remembered that millennials – who are set to be the beneficiaries of the largest ever generational transfer of wealth [according to some estimates US$60 trillion] – have been raised on technology, they’re digital natives. As such, the future of money is also, without doubt, going to be digital,” he added.
“And third, a digital dollar would underscore why the world will still want cryptocurrencies, such as Bitcoin. The Federal Reserve’s potential new currency would have many advantages, including convenience and speed of payments, but what it would not have is privacy. Indeed, a digital dollar would serve to give U.S. authorities even greater oversight of citizens’ transactions.”
Currently, around 90% of governments around the world, representing 90% of global GDP, are actively pursuing their own central bank digital currencies (CBDCs). China might have been the first large, industrialized nation to launch a CBDC with the digital yuan. As it appears, the U.S is now playing ‘catch up’.
The Federal Reserve’s potential new currency would have many advantages, including convenience and speed of payments, but what it would not have is privacy. Green says that a digital dollar would serve to give U.S authorities even greater oversight of citizens’ transactions.
“The government would be able to trace all transactions. Washington would have even more powers to track and control,” he said.
Bitcoin and cryptocurrencies – still digital money – are fundamentally different as they run on an open, immutable blockchain, or distributed ledger. This, says Nigel Green, would give them the upper hand.