Biden's Crypto Order 'Watershed Moment,' Companies Say

U.S. President Joe Biden signed an executive order this week calling on the Federal Reserve to research and potentially develop its own cryptocurrency, which was applauded by a number of digital currency companies, including one that called it a "watershed moment."

"@potus's executive order on crypto is a watershed moment. It paves the way for thoughtful national crypto regulation that will allow builders to build onshore and ensure that the US remains a leader in crypto—creating greater independence, choice, and opportunity for all," Bitcoin investor and co-founder of Gemini, a cryptocurrency trading application Cameron Winklevoss wrote on Twitter.

On Wednesday, Biden signed the executive order which in addition to calling on the nation's central bank to explore options for constructing it's own cryptocurrency, seeks to protect investors and companies from risks associated with investing in digital currencies.

"The Order lays out a national policy for digital assets across six key priorities: consumer and investor protection; financial stability; illicit finance; U.S. leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation," the White House said in a fact sheet announcing the executive order.

Biden's decision was applauded by several other cryptocurrency trading companies and digital currency investors.

In a statement sent to Newsweek, a spokesperson for Kraken, a cryptocurrency trading application said, "We agree that the US should play a leading role in the new era of digital transformation by supporting innovation while ensuring market integrity and investor protection."

The statement continued, "As a regulated global crypto exchange, Kraken will continue to work collaboratively with peers, partners and policymakers to ensure the issues outlined in the Executive Order are fully understood.… We welcome this important initiative to provide clarity on how digital asset markets will be evaluated through inter-agency coordination."

Similarly, Faryar Shirzad, the chief policy officer for Coinbase, responded to the executive order in a series of tweets, writing, "We applaud the White House for recognizing this as a defining moment for U.S. innovation on the world stage. It is and we need to harness our resources and entrepreneurship to lead."

"This is a hopeful moment. We look forward to continuing our work with regulators and lawmakers to ensure the path forward encourages public participation, protects U.S. leadership, and takes a holistic view of this transformational moment," Shirzad added.

Glenn Goodman, a contributing expert on cryptocurrency for the London School of Economics told Newsweek that the executive order is "hugely important for the future of the United States."

Goodman noted that while the American dollar has been at the center of global trade for several decades, cryptocurrencies pose a threat for "future dominance," citing China's digit currency, e-CNY.

"America's problem is that the old dollar-based financial system is slow and clunky compared to digital currencies, which can be sent around the world cheaply and at lightening speed. China's new digital currency would be cheap and simple for trading partners to use, so America needs to work fast to catch up," Goodman told Newsweek.

Shortly after the executive order was signed by Biden, several popular cryptocurrencies, such as Bitcoin saw an increase in price. According to price data from CoinDesk, the price of Bitcoin went from around $41,000 on Tuesday to around $42,542 on Wednesday. Since then, the price of Bitcoin has fallen back down to around $38,790 as of publication time.

Several cryptocurrency trading applications applauded U.S. President Joe Biden's executive order on cryptocurrency, which called on the Federal Reserve to research options for creating its own digital currency. Above, a photo illustration shows several popular cryptocurrencies, such as Bitcoin, Ripple, Ethernum, Dash, Monero and Litecoin on February 16, 2018, in Paris. Chesnot/Getty