President Joe Biden is expected to sign an executive order on cryptocurrency this week that will mark the first step toward regulating how digital currency is traded.
The move comes as administration officials have raised concerns in recent weeks about Russia’s use of cryptocurrency to evade the impact of crushing sanctions in response to its invasion of Ukraine.
The sanctions have sent the ruble to historic lows and have closed the country’s stock market.
Two people familiar with the process said the executive order on cryptocurrency was expected to be issued this week and it had been in the works long before the war. Both people spoke on condition of anonymity to preview the order.
The order is expected to describe what government agencies, including the Treasury Department, need to do to develop policies and regulations on digital currencies.
It is expected to include a request for the State Department to ensure that American cryptocurrency laws are aligned with those of US allies and will ask the Financial Stability Oversight Council — which monitors the stability of the US financial system — to study illicit finance concerns.
Additionally, the order will explore the possibility of a new central bank digital currency. The Federal Reserve issued a paper on the topic in January that explores the risks and benefits of US-backed digital currency.
Implicit in the order will be that cryptocurrency will remain a part of the US economy for years to come. The White House’s plans to move forward with the executive order were first reported by Bloomberg News.
While US officials have played down the significance of cryptocurrency to Russia’s ability to evade sanctions, it remains a concern.
“We will continue to look at how the sanctions work and evaluate whether or not there are liquid leakages and we have the possibility to address them. I often hear cryptocurrency mentioned and that is a channel to be watched,” Treasury Secretary Janet Yellen said last week.
Download Money9 App for the latest updates on Personal Finance.