In a recent report, the White House made a concern against cryptos by claiming that some elements of the ecosystem for digital assets are problematic for consumers, the economy, and the environment.
Worries at the White House
By highlighting the drawbacks of digital assets across a lengthy, 513-page annual report, the White House threw cold water on cryptos.
The council of economic advisers’ annual update and the President’s Economic Report for 2023 both make the first mention of digital assets, which is where it is stated that digital assets that are financially innovative and have shown to be highly volatile and fraud-prone have risen as a result of blockchain technology.
The news comes amid growing industry anxiety that federal regulators are attempting to debank crypto businesses, while state and federal regulators have refuted these assertions. Yet, the tone of the report is unlikely to soothe these fears.
The White House asserts that a large portion of the case for digital assets may be defeated by the Fed’s soon-to-be-launched faster payments network but adds that “continued investments in the nation’s financial infrastructure have the potential to offer significant benefits to consumers and businesses.”
The research questions the viability of a digital currency issued by the U.S. central bank but does not rule it out, claiming that CBDCs could reduce credit availability and increase the risk of bank runs.
However, Europe has a different perspective. Christine Lagarde, president of the European central bank, feels that the digital euro will be crucial in preserving European payment autonomy. She also warned that depending on one supplier for important daily necessities is exceedingly unhealthy.
According to the annual economic report, some advantages of distributed ledger technology might be realized in the future. It references, in particular, the New York Fed’s pilot program for a wholesale central bank digital currency designed to make transfers between banks, including cross-border transactions, nearly instantaneous.
Digital assets, according to the White House study, are likewise ineffective as both a means of payment and storing value.
However, the White House research clearly shows how the administration feels about cryptos. The White House thinks that investors face danger from digital assets because they don’t give any fundamental value.
It’s vital to remember that the crypto market is still developing. Since technology is continually growing, the industry may continue to expand and advance.