Huobi Research Institute, the leading blockchain research organization, today published a report, titled “A Deeper Look at Biden’s Executive Order on Digital Assets Regulation.” The report points out the underlying priorities of the U.S. government and analyzes the impact of U.S. President Biden’s executive order on the regulation of digital assets. It also outlines the role of each agency or department in monitoring different aspects of the sector.

Pew Research Center surveys found that 16 percent of U.S. adults have traded or invested in cryptocurrencies. The popularity of cryptocurrencies is increasing, and more people want the U.S. government adopting a more thorough approach to regulate the asset. The President signed an executive directive on March 9 mandating this approach. It calls for 20 regulatory agencies and departments to concentrate their oversight in different areas.

For instance, the Department of Treasury leads the study of CBDCs. It also comes up with ideas and solutions. CBDCs will be a joint effort of the Department of Treasury, Federal Reserve Board and a few other agencies.

Biden’s Executive Order is Designed to Protect Consumers and Investors

In this report, Huobi Research Institute analyst Barry Jiang argues that the number one goal is to protect consumers, investors, and enterprises – starting by regulating centralized exchanges. Given their importance and threat to the wider financial sector, centralized exchanges are the ones that will get the most scrutiny. These exchanges must adhere to code of conduct regarding data privacy and protection, protection of investor assets, design of processes, risk disclosure, and protection of personal information.

It is also important to protect the nation from potential criminality and other national security threats. In accordance with the executive order, the departments and executive agencies must complete within 90 days reports about the illegal financial risks associated with digital assets as well as strengthening international cooperation in law enforcement. Others reports are due in 120-180 days.

Regulators will have a harder time controlling and regulating areas like DeFi and peer-to-peer payment. Law enforcement agencies around the globe will have to collaborate with counterparts from other countries to implement stricter KYC standards.

The U.S. America Wants to Keep Its Top Position in the Global Financial System

Huobi Research Institute points out that such a comprehensive approach to cryptocurrency regulation is designed to help maintain the America’s leading role in the global financial system. US government recognizes that cryptocurrencies are going to play a greater role in the future, and it is keen to ensure that regulation is used to guide the market in America’s favor.

The U.S. leads in certain areas of the crypto industry. The United States is the country most desirable for funding and startups in crypto, having invested $14.1 billion by 2021 in U.S.-based startups, which represents 56% of all global crypto funding. However, there are areas where the U.S. is still behind, like the development and research of digital currency central banks (CBDCs).

Click here to download the complete report

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