Yesterday the U.S. Treasury published an interagency framework to engage internationally about digital assets in response to President Biden’s Executive Order on the topic. Hence to tackle regulatory arbitrage, it plans for multiple U.S. agencies to actively participate with global bodies that are setting principles for dealing with digital assets. This includes cryptocurrencies, stablecoins and central bank digital currencies (CBDCs).
While the framework isn’t entirely about regulation, the first three motivations include protecting consumers, preserving financial stability and mitigating illicit finance. A key challenge is the border free nature of digital assets, which encourages international regulatory arbitrage. However, it is keen to support innovation.
Beyond that, the aim is to ‘Reinforce U.S. leadership in the global financial system’. The Treasury is keen for U.S. companies to lead in developing central bank digital currency (CBDC) infrastructure.
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