Ladies and Gentlemen:
The Bank Policy Institute[1] appreciates the opportunity to comment on the Department of
Commerce’s Request for Comment on “Developing a Framework on Competitiveness of Digital Asset Technologies” in connection with Executive Order 14067, “Ensuring Responsible Development of Digital Assets.”[2] According to the Fact Sheet accompanying the Executive Order, digital assets, including cryptocurrencies, exceeded a $3 trillion market cap last November, although published reports indicate that recent turmoil in those markets has reduced that number by as much as two-thirds. In addition, some surveys indicated that around 16 percent of adult Americans – approximately 40 million people – have invested in, traded, or used cryptocurrencies. In light of the growth of digital assets over the past few years and the risks that are presented by digital assets and related activities that are not yet subject to a comprehensive regulatory framework, BPI supports the goal of the Executive Order to promote a coordinated, “whole of government” approach to fostering responsible innovation and the following specific policy objectives for digital assets articulated in the Executive Order:
(a) protection of consumers, investors, and businesses in the United States;
(b) protection of United States and global financial stability and the mitigation of systemic risk;
(c) mitigation of illicit finance and national security risks posed by misuse of digital assets;
(d) reinforcement of U.S. leadership in the global financial system and in technological and
economic competitiveness, including through the responsible development of payment
innovations and digital assets;
(e) promotion of access to safe and affordable financial services; and
(f) support of technological advances that promote responsible development and use of digital
assets.
Section 8(b)(iii) of the Executive Order directs the Secretary of Commerce, in consultation with
the Secretary of State, the Secretary of the Treasury, and the heads of any other relevant agencies, to establish a framework for enhancing U.S. economic competitiveness in, and leveraging of, digital asset technologies. We appreciate the Commerce Department’s solicitation of input and recommendations as it considers the development of this framework for digital assets.[3]
BPI supports innovation, but believes it must be conducted in a manner consistent with the
safety and soundness of the financial system, national security, and robust consumer and investor protection. A coordinated, government-wide approach to establishing a comprehensive framework for regulating digital assets and related activities will help to ensure that the United States remains a global leader in innovation while also ensuring that consumers, the financial system, and national security are protected.
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[1] The Bank Policy Institute is a nonpartisan public policy, research and advocacy group, representing the nation’s leading banks and their customers. Our members include universal banks, regional banks and the major foreign banks doing business in the United States. Collectively, they employ almost 2 million Americans, make nearly half of the nation’s small business loans, and are an engine for financial innovation and economic growth.
[2] 87 Fed. Reg. 14143 (March 14, 2022).
[3] Section 8(b)(iii) of the Executive Order directs the Secretary of Commerce, in consultation with the Secretary of State, the Secretary of the Treasury, and the heads of any other relevant agencies, to (within 180 days of the date of the Executive Order) establish a framework for enhancing U.S. economic competitiveness in, and leveraging of, digital asset technologies.
