Biden's executive order on cryptocurrencies zeros in on 6 priorities and 'urgency' in exploring the creation of a US digital dollar

• The White House on Wednesday outlined President Biden's executive order on cryptocurrencies.
• There are six key priorities for developing national policy for digital currencies whose market has grown to roughly $2 trillion.

Protecting consumers, reducing crime risks, and examining a potential US digital dollar are among the directives in President Joe Biden's executive order on cryptocurrencies which aims to unify the US government's oversight of the $2 trillion market for digital assets.

The White House released an outline of Biden's executive order signed Wednesday that tells federal agencies to study the risks and benefits of cryptocurrencies whose rising use and adoption by mom-and-pop consumers and major financial institutions have pushed the market to new heights in the past year. The order sweeps across government agencies as there is no one cryptocurrency regulator in the US.

There are six key priorities for a national policy for digital assets. Among them:

• Protect U.S. Consumers, investors, and businesses. The order directs the Treasury Department to assess and develop policy recommendations to address the implications of the digital asset sector and changes in financial markets for those groups.
• Protect U.S. and global financial stability and mitigate systemic risk. Biden wants the Financial Stability Oversight Council to identify and ward off financial risks posed by digital assets and recommended policies to address regulatory gaps.
• Mitigate the illicit finance and national security risks posed by the illicit use of digital assets. The order calls for "unprecedented focus" of coordinated action across all relevant agencies to mitigate such risks and directs agencies to work with US allies and partners to ensure an aligned response to risks.

Outside of the six priorities, the president is "placing urgency" on research and development of a potential US digital dollar, or a Central Bank Digital Currency, if issuing one is deemed in the national interest. The government should assess the technological infrastructure and capacity needs for a potential virtual greenback and Biden "encourages" the Federal Reserve to continue its assessment of a CBDC.

There are 87 countries exploring the issuance of a digital fiat currency, according to tracking by the Atlantic Council. Ukraine, China, and South Korea are among 14 countries that have launched pilot programs and nine countries have launched digital versions of their currencies.

Work on Biden's executive order began well before Russia's invasion of Ukraine nearly two weeks ago, sources told the Associated Press. The administration has been concerned about the use of cryptocurrencies by Russia to sidestep international sanctions stemming from the war it launched against the former Soviet republic.