On March 9, 2022, the 46th President of the United States Joe Biden signed the 83rd executive order which aimed to develop digital assets in a responsible manner. The Executive Order 14067, officially bearing the name Ensuring Responsible Development of Digital Assets examined the national security implications of cryptocurrencies, and addressed its benefits and potential risks.
Knowing what is Executive Order 14067, the pros and cons are important but there’s more to it. The order could significantly alter how we use money by promoting digital currencies and exploring Central Bank Digital Currencies (CBDCs). Every stakeholder in the financial and cryptocurrency landscape needs to understand how Executive Order 14067 could change the way we use money and this publication will provide clarity on this topic.
In this article, we will provide an overview of the executive order, we will briefly discuss the concept of digital currencies and their rise, will define Central Bank Digital Currencies, the impact of the executive order on digital currencies, and the potential benefits and challenges of the executive order.
Background on Executive Order 14067
President Biden’s initiative, the Executive Order 14067 is the bedrock for a future where transactions are efficient, secure, and transparent. This vital directive from the White House holds significant implications for the nation’s financial strategy. It recognizes the important role that digital assets are playing in America’s economic ecosystem.
The executive order was issued in response to the dramatic growth in markets for digital assets, to maintain the U.S. position as a global leader in the development and adoption of digital assets. The executive order was issued because of the nation’s interest in financial innovation; to foster access to safe and affordable financial services, reduce potential risks associated with digital assets, and because of global economic trends, one of which was how global monetary authorities were exploring and some were already introducing central bank digital currencies (CBDCs).
Objectives of the Executive Order 14067
The executive order depicts the federal government’s approach to cryptocurrency and digital asset strategy. The key objectives of this order were to:
- Ensure the United States remains at the forefront of innovations in the digital asset industry and blockchain technology in the world.
- Ensure effective protection of data privacy while providing safe, accessible, and affordable financial services.
- Lessen the potential financial risks that could harm the nation’s economic fabric.
The Executive Order 14067 and Digital Currency
According to the Atlantic Council, 134 countries and currency unions were engaged in CBDCs at a certain level (launched, researching, piloting, or developing) as of September 2024. Jamaica (JamDex), the Bahamas (Sand dollar), and Nigeria (e-Naira) are the only three countries to have formally launched CBDCs. China’s digital Yuan (e-CNY) is the largest CBDC pilot in the world with a transaction volume of approximately 7 trillion e-CNY ($986 billion) in 17 provincial regions.
Executive Order 1406 created an assemblage of interagency led by the Treasury to accelerate the development and adoption of digital currencies. This assemblage was put in place to consider pursuing a CBDC. A CBDC would allow users to store and make payments digitally, and a CBDC by the U.S. government will bring access to the unbanked population in the United States of America. The U.S. with 6 other major central banks is currently participating in a cross-border wholesale CBDC project themed, Project Agora. In May 2024, the US House passed a bill prohibiting the direct issuance of a retail CBDC, however, the Senate is yet to act on this.
Final Thoughts
The Executive Order 14067 ensures measures are in place to promote the development of U.S.-supported digital assets that can compete with cryptocurrencies and grant access to safer and more affordable financial services to protect stakeholders and ensure privacy. This aims to uphold and protect the U.S. dollar’s dominance as the most-used currency globally. There is a lot of input needed to make President Biden’s vision a success story and several efforts are made in the industry.
