White House Fact Sheet: Global Framework for Responsible Development of Digital Assets | Cadwalader, Wickersham & Taft LLP


Last Friday, September 16, the White House released a “fact sheet” that sets out a comprehensive framework around which a plethora of federal government departments and agencies are responsible for dealing with digital assets, in one way or another. of another.

The scope of this framework is quite broad and not too surprising, as it mirrors the early statements of President Biden’s March 2022 Executive Order (“EO”) regarding digital assets, but contains some interesting details and unexpected positions. , once one dives below the surface. For example, while the OE discusses central bank digital currency (“CBDC”) as a topic for further exploration, the fact sheet reveals an administration that is now quite optimistic about the development of a CBDC in the United States.

After observing that to date, 16% of American adults have purchased digital assets and that the market capitalization of digital assets, as of November 2021, was $3 trillion, the fact sheet curates the plethora of activity covered in seven main categories. Meanwhile, the EO had ordered several parts of the federal government to release reports on various aspects of digital asset development, with a due date of early September 2022, and so the fact sheet generously interweaves the findings and information from these reports throughout.

The first category of activities revolves around the theme of Protect consumers, investors and businessesand the fact sheet lists the following activities under this pillar of the framework:

  • Continued enforcement against illegal practices in the digital asset space by the Securities & Exchange Commission (“SEC”) and the Commodity Futures Trading Commission (“CFTC”);
  • Ongoing monitoring of consumer complaints and the use of unfair or deceptive acts or practices by the Federal Trade Commission (“FTC”) and the Consumer Financial Protection Bureau (“CFPB”);
  • Collaboration between law enforcement and regulatory agencies to address the risks to consumers, investors and businesses raised by digital assets; and
  • Public awareness campaigns to be organized and disseminated by the Financial Literacy Education Commission[1] (“FLEC”).

The second category of activities concerns Safe and affordable financial services and includes the following:

  • Encourages the development and adoption of instant payment systems by federal agencies, including using digital asset technologies such as blockchain software and distributed ledger technology;
  • calls for the development of a federal framework to regulate non-bank payment providers;
  • Prioritizes efforts to improve the efficiency of cross-border payments; and
  • Charges the National Science Foundation (“NSF”) with ensuring that digital asset ecosystems are designed to be usable, inclusive, equitable, and accessible.

The third pillar of the overall framework announced by the fact sheet is called Promote financial stability and points out that there is “potential for instability” even when the digital asset in question is a so-called stablecoin. To this end, the Financial Stability Oversight Council (“FSOC”) has been tasked to issue a report in October 2022 regarding the financial stability risks of digital assets, in general; identify regulatory gaps in dealing with digital assets; and make recommendations. Additionally, the Treasury is responsible for working with financial institutions to bolster digital assets in the U.S. economy and working with other agencies to identify and track strategic risks.

The fourth series of activities concerns Advancing Responsible Innovation of digital assets. Specifically, the NSF is re-tagged, working with the White House’s Office of Science and Technology Policy (“OSTP”), to create a research and development program that addresses: next-generation cryptography, programmability of transactions, cybersecurity and privacy protection, environmental impacts. digital assets, and methods of informing, educating and training various stakeholders about digital assets. Additionally, the Department of Energy and the Environmental Protection Agency (“EPA”) are tasked with working on the environmental impacts of digital assets, particularly with a view to aligning them with the transition to a low-energy economy. net zero emissions. Finally, the Department of Commerce is responsible for bringing together government, industry, academics and the public to discuss digital assets.

The fifth pillar deals Strengthen global financial leadership and competitiveness, and draws heavily on the Treasury’s ongoing exploration of “the implications of the development and adoption of digital assets and changes in financial markets and payment infrastructure”. See 87 Fed. Reg. 40881.

The sixth category includes Fight against illicit financing Activities. The primary objective of these activities is to significantly reduce the use of digital assets for money laundering, criminal goods and services, and human trafficking, which frequently occurs today due to the anonymous nature of existing digital assets such as Bitcoin. Specifically, the administration says it supports legislation to target unlicensed money transmission, so that the definition of money transmission is expanded to include digital asset exchanges, including marketplaces. non-fungible tokens (“NFT”). The Treasury is responsible for publishing a February 2023 report on illicit finance risks and a July 2023 report on NFTs.

Finally, the seventh pillar of the framework emphasizes Explore a U.S. central bank currency and includes a broad list of benefits the administration sees from a U.S. CBDC, including such a CBDC could:

  • Result in a more efficient payment system that would reduce costs and the time required for payments to be considered final;
  • Facilitate faster cross-border transactions;
  • Provide environmental sustainability;
  • Promote financial inclusion and equity by enabling broad access;
  • promote economic growth;
  • Protect against privacy and security attacks;
  • Better protect sensitive data;
  • Minimize illicit transactions;
  • Preserving US global financial leadership; and
  • Support the effectiveness of US monetary sanctions.

Cadwalader will provide detailed notes to customers and friends in the coming days regarding a number of topics covered in this summary, including a review of what a CBDC could mean for consumers, investors and businesses and financial institutions. who serve them, as well as the environmental, social and governmental (“ESG”) considerations of digital assets, and the implications of an expanded definition of money transmission and increased anti-money laundering requirements money (“AML”) for several players in the digital asset industry.

[1] The Financial Literacy Education Commission sits within the Department of the Treasury and is chaired by the Secretary to the Treasury, deputy chaired by the Director of the CFPB and co-ordinated by the Office of Consumer Policy of the Treasury. Nineteen federal agencies and departments are members of FLEC, including federal banking regulators, as well as several departments and FEMA.


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