A new initiative from the U.S. Treasury calls on President Biden to work with international partners on regulating cryptocurrency.
In a memorandum to the president, the U.S. Treasury — in consultation with the Secretary of State and Secretary of Commerce — is aiming to develop global standards for digital payments and central bank digital currencies (CBDCs) in order to protect consumers and business and ensure financial stability.
“The United States must continue to work with international partners on standards for the development of digital payment architectures and CBDCs to reduce payment inefficiencies and ensure that any new payment systems are consistent with U.S. values and legal requirements,” the report said.
The agencies recommend that the U.S. continue working with the G7 on crypto, focusing on movement of money in private and public sectors, reducing payment inefficiencies, CBDCs and adoption of new technologies.
They also encourage the U.S. to work with key allies to develop a vision for digital assets that ensures financial stability and national security through strong regulations. That includes protecting consumers and investors, guarding against arbitrage opportunities, money laundering, terrorist financing and sanctions evasion.
Another recommendation from the memorandum is for the U.S. work with the Organization for Economic Cooperation and Development (OECD), International Monetary Fund (IMF), and G20 to engage with other major economies to make cross-border payments using crypto more seamless and safe. In working with foreign counterparts, the agencies said, rules should reinforce U.S. leadership in the global financial system.
The report is the first of many forthcoming reports from the Biden administration at the direction of the president’s executive order issued in March on how to regulate cryptocurrencies.
When it comes to CBDCs, the agencies recommended that the U.S. explore opportunities to experiment with other countries on technologies, which would offer the opportunity for American companies to lead in developing infrastructure and technology for CBDCs around the world and at home, should one be pursued.
This report comes as the European Union put forth the first comprehensive piece of crypto regulation that’s expected to be implemented within the next 18 months and could set a global standard. Back in the U.S., Sens. Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) introduced comprehensive legislation to regulate crypto in June.
Jennifer Schonberger covers cryptocurrencies and policy for Yahoo Finance. Follow her at @Jenniferisms.
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