Joe Biden orders government to study digital dollar, other cryptocurrency risks

moneycontrol.com:

U.S. President Joe Biden will sign an executive order on Wednesday requiring the government to assess the risks and benefits of creating a central bank digital dollar, as well as other cryptocurrency issues, administration officials said.

Biden's order will require the Treasury Department, the Commerce Department and other key agencies to prepare reports on "the future of money" and the role cryptocurrencies will play.

Wide-ranging oversight of the cryptocurrency market, which surged past $3 trillion in November, is essential to ensure U.S. national security, financial stability and U.S. competitiveness, and stave off the growing threat of cyber crime, officials said.

Analysts view the long-awaited executive order, first reported on Monday, as a stark acknowledgement of the growing importance of cryptocurrencies and their potential consequences for the U.S. and global financial systems.

One of its key measures directs the U.S. Government to assess the technological infrastructure needed for a potential U.S. Central Bank Digital Currency (CBDC) -- an electronic version of dollar bills in your pocket.

In January, the U.S. Federal Reserve kicked the question of whether the United States should pursue a digital dollar to Congress, leading analysts to predict such a project would take years.

But one official said the United States would move forward with developing a digital dollar, albeit with care given the dollar's role as the world's primary reserve currency.

"We've got to be very, very deliberate about that analysis because the implications of our moving in this direction are profound for the country that issues the world's primary reserve currency," the official said.

The order also encourages the Federal Reserve to continue