With the return of crypto winter, the White House is making big plans for the sector

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From an ATH of $69,000 last year, Bitcoin has now lost 50% of its value in the current market drop. Markets are seen to be volatile and adoption in the industry is undeniably at its peak.

Monetary policy and regulatory environment

Many experts believe that market weakness is the result of the withdrawal of liquidity from the market by the Federal Reserve. But the fear of regulations stifling the industry is also high.

A Russian crackdown seems imminent, the UK is getting tougher with crypto advertising, and the EU is worried about the mining side of the sector. Meanwhile, the only significant debate in the United States has been over what constitutes “security” when it comes to crypto tokens. With the Ripple vs SEC lawsuit at the forefront of the debate.

That being said, the Biden administration is reportedly preparing its whole-of-government strategy for digital assets.

Bloomberg reported citing sources that the initial release, which outlines the sector’s risks and opportunities, can be expected in February 2022. And, when that happens, the executive order regarding cryptocurrencies will put President Biden and his administration in the spotlight in the crypto industry.

The development follows preliminary and incomplete guidance from the SEC, CFTC, and the U.S. Treasury Department, among other agencies.

Recently, SEC Chairman Gary Gensler had noted that crypto exchanges would come under increased scrutiny from the regulator. Along with the goal of placing the sector under the “investor protection mission”. It is worth mentioning that in this regard, we have just seen the regulator take down two other physically backed Bitcoin ETFs.

Well-rounded advice?

Now, the report notes that subsequent drafts of the next version of the Crypto Guidelines are expected to outline “economic, regulatory and national security challenges” in the crypto industry.

The directive would have other agencies like the Financial Stability Supervisory Board and the US Department of Commerce. Along with this, the report cites the possibility that a US CBDC is also on the way.

Only recently, the Fed said in its preliminary document,

“The introduction of a CBDC would represent a very significant innovation in American money,”

While the central bank has opened the doors to a future CBDC, the Fed is taking public comments on paper until May 20, 2022.

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