Well, that didn’t last long.
Bitcoin and other digital currencies were sliding Thursday, one day after President Joe Biden signed his executive order on cryptocurrencies.
Bitcoin was down 6.3% to $39,314 at last check, according to CoinGecko, while ethereum was off 4.7% to $2,605 and dogecoin slipped 4.1% to $0.116924.
‘A Good Signal to Serious People’
Among other things, Biden’s order directs Treasury and other departments to come up with policy recommendations “to address the implications of the growing digital asset sector and changes in financial markets for consumers, investors, businesses, and equitable economic growth.”
Biden’s order also calls for research and development of a potential U.S. Central Bank Digital Currency.
Reaction among crypto industry analysts has been generally positive.
“The message I take from this EO is that the federal government sees cryptocurrency as a legitimate, serious, and important part of the economy and society, and I think it’s a good signal to serious people who’ve been holding back from getting involved,” Jerry Brito, executive director of Coincenter, said on Twitter.
Philippe Bekhazi, CEO of StableHouse and XBTO, said the company was founded to make crypto an integral part of everyday finance and with Biden’s order on cryptocurrency regulation, “we take one step closer in that direction.”
“As monetary policy around the world continues to cause harmful inflation to local fiat currencies, particularly in the United States, it is critical for all players in the ecosystem to come together and work toward a greater good for all market participants,” he said.
“Like many of you, I thought the Biden Admin’s EO would acknowledge crypto, but not detail specifics on next steps for regulation,” Brad Garlinghouse, CEO of Ripple tweeted. “However, I was pleasantly surprised & inspired by the EO acknowledging the *need* for evolution and alignment of the govt’s approach to crypto.”
‘The Right Balance’
Will Evans, Managing Director, the Americas, CEX.IO, said the executive order contains an encouraging nod toward the need to “nurture the potential of Web3, address legitimate concerns, and strike the right balance.”
“We are optimistic about the shape these goals will take in the coming days, weeks and months, and we hope to one day be an active participant in a market with a regulatory landscape where the right balance has been realized,” Evans said.
Jake Chervinsky, head of policy for the Blockchain Association, had said the order was “about as good as we could ask.”
“One feature of the EO that I can’t figure out: it doesn’t mention tax policy once,” Chervinsky tweeted. “That’s pretty weird given how many tax issues are unresolved. Maybe the thinking is Treasury doesn’t need to study taxation b/c the infrastructure bill already handled it? That would be a mistake.”
Themelio Founder Eric Dong was less than enthusiastic about the idea of a Central Bank Digital Currency.
He said CBDCs are anything from “largely unnecessary to horrible.”
Dong said he worried “that current ideas are an attempt to cover up bad monetary policy through financial repression and capital controls, both of which are much easier to enforce with CBDC, and trend towards ‘horrible’.”
“The solution to consumer protection is more liquid markets and lighter regulation,” he said. “If you prevent law-abiding entrepreneurs from doing ICOs (Initial Coin Offerings) the only ICOs left would be run by criminals.”