The U.S. Department of Treasury announced they have outlined an interagency approach to address the risks and harness the potential benefits of digital assets and their underlying technology, including through international engagement to adapt, update, and enhance the adoption of global principles and standards for how digital assets are used and transacted.
This was done in response to an executive order from President Biden titled: “Ensuring Responsible Development of Digital Assets”. In short, the Department of Treasury has developed regulations regarding digital assets.
Technology-driven financial innovation is frequently cross-border and can impact households, businesses, and governments across the world. International cooperation among public authorities, the private sector, and other stakeholders is therefore critical to maintaining high regulatory standards and a level playing field, expanding access to safe and affordable financial services, and reducing the cost of domestic and cross-border payments, including through the continued monetization of public payment systems…
Objectives Of The Framework include:
Protect consumers, investors, and businesses in the United States and globally by promoting technology and regulatory standards that reflect U.S. values;
Protect U.S. and global financial stability and mitigate systemic risk;
Mitigate illicit finance and national security risks posed by misuse of digital assets and counter and response to efforts by foreign adversaries to drive standards and promote their protocols;
Reinforce U.S. leadership in the global financial system and in technological and economic competitiveness, including through the responsible development of payment innovations and digital assets by advancing technology and regulatory standards that align with U.S. values;
Promote access to safe and affordable financial services; and
Support technological advances that promote responsive development and use of digital assets by advancing research and relationships that increase shared learning.
What does this all mean? For further information, you can read the Fact Sheet on the U.S. Department of the Treasury’s website. It’s a bit long, and not very easy to understand.
CoinDesk reported that the U.S. Treasury Department’s fact sheet states the framework’s policy objectives also include reducing the potential use of crypto for illicit finance promoting access to financial services, supporting technological advancement and “reinforc[ing] U.S. leadership in the global finance system.”
The Register reported that the framework suggests wide engagement with allies and international institutions to create mutually agreeable arrangements. In the field of crypto – or “digital assets” …that means working with G7, G20, OECD, International Monetary Fund, World Bank, and others.
One thing to keep in mind is that the Department of Treasury included this: “Such international work should continue to address the full spectrum of issues and challenges raised by digital assets, including financial stability; consumer and investor protection, and business risks; and money laundering, terrorist financing, proliferation financing, sanctions evasion, and other illicit activities.” In other words, one should be extremely careful with their cryptocurrency if they want to avoid having to face sanctions for using it in nefarious ways.