Biden Administration’s Crypto Framework: Concerns and Criticisms from Industry Leaders

Regulatory Framework Release

On a seemingly ordinary Friday, the White House decided to stir the pot by releasing a regulatory framework for digital assets. Nine reports were submitted by federal agencies, tying back to an executive order by President Biden from March. Included in this mind-boggling mix of policies is a plan for a U.S. central bank digital currency, environmental regulations for crypto mining, and consumer protection laws. Exciting stuff, right?

Environmental Concerns Take Center Stage

One of the spotlight grabbers in this framework is the spotlight on the environmental impact of cryptocurrencies. Yes, the age of crypto-bashing about energy consumption has officially found a solidified argument. Officials are exploring how they can mitigate the energy consumption of these digital wizards while pushing for a payment system like FedNow, scheduled for next year. Because who needs decentralization when you have centralization?

Industry Leaders Speak Out

Unsurprisingly, the responses from industry leaders were anything but muted. Twitter saw the likes of crypto analyst Dylan LeClair and MicroStrategy’s Michael Saylor hit back, claiming the administration is using these environmental concerns to gain control over the industry. Saylor succinctly put it if they don’t like how energy is used, just adjust the pricing! Because nothing says fair like market manipulation!

A Missed Opportunity?

While the reports were somewhat of a necessary bureaucratic formality, many voices in the crypto community felt the administration missed a golden opportunity to position the U.S. as a leader in crypto. Kristin Smith, of the Blockchain Association, highlighted that the focus was largely on risks, overlooking the booming opportunities that could spark innovation and leadership.

Looking Ahead: What’s Next?

The White House is gearing up to keep the ball rolling. The Treasury Department is expected to present an illicit finance risk assessment by February, while a report on financial stability risks is set for October. So buckle up, folks! The world of crypto regulations is far from boring with these ongoing developments.