Tags: bitcoin | digital regulation | biden admin

Bitcoin Jumps Ahead of Biden's Order on Digital Assets

Salvadoran newspaper reads, "They recommend the government to renounce the use of bitcoi," referring to The International Monetary Fund (IMF) urging El Salvador to withdraw bitcoin as a legal tender, a blow to President Nayib Bukele. (Getty Images)

Wednesday, 09 March 2022 08:47 AM EST

Bitcoin surged on Wednesday ahead of an executive order that U.S. President Joe Biden will sign on digital assets, which is likely to raise the legitimacy of virtual currencies in the U.S. financial system.

Digital currencies surged overnight after what appeared to be a prematurely published U.S. Treasury statement that allayed market worries about a sudden tightening of U.S. rules around digital assets.

In a statement that briefly appeared on the Treasury website before it was taken down, Treasury Secretary Janet Yellen said a still-pending executive order on virtual currencies from President Joe Biden "calls for a coordinated and comprehensive approach to digital asset policy (that) will support responsible innovation."

The U.S. Treasury Department said the statement was posted early due to a web error and was reposted Wednesday morning.

"The market has clearly been heartened by talk of supporting responsible innovation and a constructive approach to regulating the evolving digital token economy," Bitfinex Trading team said in a note.

Biden is expected to sign the long-awaited executive order on Wednesday directing the Justice Department, Treasury and other agencies to study the legal and economic ramifications of creating a U.S. central bank digital currency.

The White House last year said it was considering a wide-ranging oversight of the cryptocurrency market - including an executive order - to deal with the growing threat of ransomware and other cyber crime.

Bitcoin rose 8.4% to $42,025, on track for its biggest gain since Feb. 28, while smaller peer ether, the coin linked to the ethereum blockchain network, added 6.1% to $2,736, also set for its best day this month.

"We don't want to see too many regulations too fast – we want regulations but we want a steady hand doing it. The SEC (U.S. Securities and Exchange Commission) will be the leader in my opinion on (global) regulations," said Ed Hindi, chief investment officer at Switzerland-based Tyr Capital Partners.

U.S. exchange traded funds (ETFs) tracking bitcoin futures that gained regulatory approval late last year also jumped in premarket trading. ProShares Bitcoin Strategy ETF and Valkyrie Bitcoin Strategy ETF surged nearly 10%, each.

U.S. crypto miners that act as a proxy for moves in digital coins also advanced. Riot Blockchain jumped 9.5% and Marathon Digital Holdings 9.5%, while crypto exchange Coinbase Global Inc added 6%.

© 2024 Thomson/Reuters. All rights reserved.

bitcoin, digital regulation, biden admin
Wednesday, 09 March 2022 08:47 AM
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