President Biden announced the long-awaited Executive Order regarding digital assets, cryptocurrencies, and the potential for the creation of a central bank digital currency (CBDC) on Wednesday, one that has been broadly well received by crypto industry advocates.
Matt Hougan, CIO of Bitwise, gave an interview with CNBC shortly after the release of the EO which detailed much of what industry participants are generally feeling regarding the language the order was couched in.
“The big question coming into the executive order was whether it was going to be balanced, whether it was going to talk about both the risks and the opportunities of crypto,” Hougan explained. “Based on our initial read of what’s in there, it does exactly that.”
The executive order sets 180 days as the review cycle for any and all regulated regulatory agencies that pertain to crypto to do an extensive analysis on risks, benefits, what kinds of existing regulatory frameworks would be applicable, and what ones would need to be created.
“The crypto market needs better and clearer regulations if it’s going to go truly mainstream if it’s going to go from a $1.5 trillion dollar industry to a $15 trillion industry,” Hougan said.
Much of the language in the executive order recognized the potentials and positive aspects of the crypto industry, including the innovation that is inherent within it. It also highlights the risks it poses to investors and companies and would seek to curtail that risk by bringing it into the fold of a regulated framework if that is ultimately the best course of action decided.
“What we got here was sort of a shock kind of start telling all regulators to push that forward, do so in a way that protects investors but… that keeps the economic development here in the U.S.,” Hougan explains. “I think it’s pretty close to the outcome we were all hoping for.”
The EO also calls for research into the merits of a CBDC and tasks the Justice Department with researching into the need for and creation of any new legislation to make such a thing possible.
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