President Joe Biden's government is a step closer to developing a digital dollar, which officials say could present substantial economic opportunities for the United States. Photo by John Angelillo/UPI | License Photo
Sept. 16 (UPI) -- President Joe Biden's administration has moved closer to developing an official cryptocurrency -- known presently as a digital dollar -- after extensive research and projections that say it could be in the national interest.
The White House announced a recommendation from the Treasury to explore the creation of an official central bank crypto as part of a comprehensive blueprint for regulating cryptocurrency, improving online financial services and cracking down on digital fraud.
The recommendation came months after Biden ordered federal agencies to explore creation of a digital dollar and its expected impacts. All the agencies submitted reports on the matter; the Treasury submitted three.
"The reports address the future of money and payment systems, consumer and investor protection and illicit finance risks," the Treasury said in a statement.
The Treasury and other agencies say their studies concluded that there very well be a national interest in introducing a digital dollar, also known as central bank digital currency, or CBDC.
"Innovation is one of the hallmarks of a vibrant financial system and economy," Treasury Secretary Janet Yellen said in a statement. "But as we have learned painfully from the past, innovation without appropriately addressing the impact of these developments can result in significant disruptions and harm to the financial system."
"If risks are mitigated, digital assets and other emerging technologies could offer significant opportunities," U.S. Treasury Secretary Janet Yellen said. File Photo by John Angelillo/UPI
The Treasury recommendation moves the government a step closer to developing the digital dollar, which officials say must be regulated and protected from digital fraud -- which has involved more than $1 billion since Biden took office.
In one of the more remarkable thefts, millions worth of crypto dollars were stolen during Colonial Pipeline Co. ransomware attacks during the COVID-19 pandemic.
In another case, U.S. regulators charged almost a dozen people last month in connection with a scam that officials say bilked $300 million from retail investors worldwide. In February, regulators seized $3.6 billion in bitcoin that were stolen during a hack of the crypto exchange Bitfinex in 2016.
Brian Deese, chief of the White House National Economic Council, said the move toward a digital dollar positions the United States as a world leader in internet financial security.
"We are laying the groundwork for a thoughtful, comprehensive approach to mitigating digital assets' acute risks and -- where proven -- harnessing their benefits," he said in a statement.
"We remain committed to working with allies, partners and the broader digital asset community to shape the future of this ecosystem."
The framework will emphasize combating crypto crime, Deese said, and allows Biden to ask Congress to increase penalties for digital crimes and empower prosecutors to catch more thieves.