White House calls on Congress to intensify efforts to regulate cryptocurrencies

The administration of U.S. President Joe Biden призвала Congress to ‘step up efforts’ to oversee the digital asset market.

“Our focus is on protecting investors’ interests, holding bad actors to account, and ensuring that cryptocurrencies cannot undermine financial stability,” the White House said.

Officials stressed that in 2022 they developed the concept of ‘safe and responsible development of digital assets’. The administration also noted efforts by federal agencies aimed at raising investor awareness.

According to the press release, in the coming months the White House intends to identify priority areas of research and development that will enable the underlying cryptocurrency technologies to ‘protect consumers by default’.

“Congress must also step up its efforts. For example, [lawmakers] should expand the powers of regulators to prevent misallocation of client assets and to mitigate conflicts of interest,” the statement said.

Officials also proposed tougher transparency and disclosure requirements for cryptocurrency industry companies, harsher penalties for violations of financial market rules, and closer cooperation with international law enforcement agencies.

The White House noted that, under certain conditions, Congressional action could ‘exacerbate risks to investors and the monetary system’ and also hinder the work of government agencies.

“Legislation should not incentivize core institutions such as pension funds to dive headlong into cryptocurrency markets. […] It would be a serious mistake to enact acts that would alter the course and deepen the linkage between digital assets and the broader financial system,” the press release said.

Officials added that restricted access to cryptocurrencies by institutions helped prevent contagion to traditional markets in 2022.

The White House projects that by 2032, expanding tax reporting requirements for digital assets will bring an additional $11 billion to the U.S. budget.

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