Ban CBDC, uphold dollar sovereignty: Trump signs first crypto executive order
TechFlow Selected TechFlow Selected
Ban CBDC, uphold dollar sovereignty: Trump signs first crypto executive order
Trump signs first crypto executive order, marking the official start of the crypto renaissance.
Navigating Web3 tides with focused insightsBy KarenZ, Foresight News
Today, U.S. President Trump officially signed the executive order on cryptocurrency titled "Strengthening American Leadership in Digital Financial Technology." This executive action not only marks the U.S. government's recognition of the digital asset industry but also provides a clear policy framework for its future development. What are the key points of this executive order, and what potential impacts might it bring?
TL;DR
1. Protects crypto rights (developing and deploying related software, self-custody, trading, mining);
2. Bans CBDC;
3. Safeguards dollar sovereignty and supports dollar-backed stablecoins;
4. A new regulatory framework will be issued within 180 days to regulate the issuance and operation of digital assets, and assess the possibility of establishing and maintaining a national digital asset reserve (which may come from cryptocurrencies legally seized by the federal government through enforcement activities).
5. All agencies must review existing rules affecting the digital asset industry within 30 days and submit recommendations within 60 days on whether current regulations or guidance should be revoked or modified.
Core Content of the Executive Order
Supporting Innovation and Responsible Development
The executive order states that the administration’s policy is to support the responsible development and use of digital assets, blockchain technology, and related technologies across all economic sectors, including:
1. Protecting and promoting individuals' and private entities’ legal access to and use of open public blockchain networks, including the ability to develop and deploy software, participate in mining and validation, transact with others without unlawful censorship, and self-custody digital assets;
2. Promoting and safeguarding dollar sovereignty, including advancing the global development and adoption of lawful and compliant dollar stablecoins;
3. Protecting and promoting fair and open access to banking services for all law-abiding citizens and private entities;
4. Providing regulatory clarity and certainty based on technology-neutral laws, creating frameworks that account for emerging technologies, ensuring transparent decision-making, and clearly defining regulatory boundaries—critical elements for supporting a vibrant, inclusive digital economy and innovation in digital assets, permissionless blockchains, and distributed ledger technologies;
5. Taking measures to protect Americans from risks posed by central bank digital currencies (CBDCs), including banning the establishment, issuance, circulation, and use of CBDCs within the United States to prevent threats to financial system stability, personal privacy, and U.S. sovereignty.
Repealing Old Policies and Establishing a New Framework
1. Repeals Executive Order No. 14067 ("Ensuring the Responsible Development of Digital Assets") issued on March 9, 2022.
2. The Secretary of the Treasury shall immediately revoke the Treasury Department’s "Framework for International Engagement on Digital Assets," issued on July 7, 2022.
Pursuant to this executive order, today the U.S. Securities and Exchange Commission (SEC) officially rescinded SAB-121, the accounting guidance for crypto assets. SAB-121 was an SEC staff guidance issued in 2022 requiring companies holding cryptocurrencies to record these assets on their balance sheets and disclose associated risks. The guidance applied to all entities regulated by the SEC, particularly banks and financial institutions, potentially subjecting them to higher capital requirements and thereby limiting their ability to offer cryptocurrency custody services.
In response, U.S. Senator Cynthia Lummis stated that the repeal of SAB 121 puts the SEC back on track. Michael Saylor, founder of MicroStrategy, said repealing SAB 121 allows banks to custody Bitcoin.
Establishment of the Presidential Task Force on Digital Asset Markets
To coordinate interagency actions, the executive order establishes the Presidential Task Force on Digital Asset Markets. The task force will be led by David Sacks, Special Advisor on Artificial Intelligence and Cryptocurrency (Chair), and include heads of multiple departments such as the Treasury, Justice, Commerce, Homeland Security, Office of Management and Budget, Assistant to the President for National Security Affairs, Assistant to the President for Economic Policy (APEP), Assistant to the President for Science and Technology, Homeland Security Advisor, Chair of the Securities and Exchange Commission, and Chair of the Commodity Futures Trading Commission.
What Will the Task Force’s Legislative Proposals Include?
Within 30 days of the issuance of this order, the Treasury Department, Department of Justice, SEC, and other relevant agencies (whose leaders are members of the task force) shall identify all regulations, guidance documents, orders, or other initiatives impacting the digital asset industry. Within 60 days, each agency shall submit to the Chair recommendations on whether each identified regulation, guidance document, order, or initiative should be revoked or modified, or, in the case of non-regulatory items, adopted into regulation.
Within 180 days of the issuance of this order, the task force shall submit a report via APEP to the President, recommending regulatory and legislative proposals to advance the policies outlined in this order, including:
1. The task force shall propose a federal regulatory framework to govern the issuance and operation of digital assets (including stablecoins) within the United States. The report shall consider provisions related to market structure, oversight, consumer protection, and risk management.
2. The task force shall evaluate the feasibility of establishing and maintaining a national digital asset reserve and propose standards for such a reserve, which could consist of cryptocurrencies legally seized by the federal government through enforcement activities.
3. The Chair shall appoint an Executive Director of the task force to coordinate its day-to-day functions. On matters involving national security, the task force shall consult with the National Security Council.
4. Where appropriate and consistent with the law, the task force shall hold public hearings and solicit input from experts in digital assets and digital markets.
Banning Central Bank Digital Currency (CBDC)
The executive order states that unless otherwise required by law, no agency shall take any action within or outside the United States to establish, issue, or promote a CBDC. Additionally, any ongoing programs or initiatives related to creating a CBDC within the United States shall be immediately terminated, and no further steps shall be taken to develop or implement such programs or initiatives.
Foresight News Note: An executive order is a written and published directive issued by the U.S. President to manage the operations of the federal government. It does not require congressional approval. While executive orders and proclamations have legal force, they are not laws. Only the sitting U.S. President can overturn an existing executive order by issuing a new one.
Potential Impacts
A clear regulatory framework coupled with government support will provide a more stable environment for the digital asset industry, attracting greater capital and talent into the sector. Meanwhile, ordinary investors will gain increased confidence in digital assets due to stronger regulation and higher transparency.
Moreover, by promoting the global growth of dollar-denominated stablecoins (rather than CBDCs), the United States will further solidify the dollar’s dominant role in the international financial system and enhance its economic influence. At the same time, stablecoins are poised to enter their golden era, serving as a crucial bridge between traditional finance and digital finance.
Notably, Trump’s crypto executive order excludes both the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) from the digital asset task force. The FDIC is responsible for securing bank deposits, and its exclusion may weaken the task force’s capacity to protect consumer rights and maintain financial stability. The absence of the Federal Reserve and FDIC could lead to fragmented regulation.
Regarding the creation of a digital asset reserve, the executive order directs the task force to assess the feasibility of establishing and maintaining a national digital asset reserve composed of cryptocurrencies legally seized by the federal government through enforcement operations. There is currently no indication that the government will purchase cryptocurrencies from the open market.
Michael Saylor stated that Trump’s signing of the crypto executive order marks the official beginning of a crypto renaissance. This executive action not only provides clear policy direction and strong legal support for the development of the U.S. digital asset industry but also injects new energy and momentum into the prosperity and growth of global digital financial markets. Policy shifts by the United States in the digital asset space may prompt emulation or responses from other countries, fostering broader international regulatory coordination and cooperation in digital assets.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
Foresight News
