The UK Treasury announced in official circles that it would not seek a strategic reserve of Bitcoin because of the currency’s volatility. The step is a reflection of the US government’s experiment as President Trump’s administration is also weighing the possibility of whether to establish a Bitcoin reserve.
The Treasury spokesperson says that Bitcoin’s history of past prices renders it an unsuitable choice as a national asset to counter hard fiat money and commodities.
President Trump’s Crypto Plans
Simultaneously, President Trump is reported to be signing an executive order stopping crypto debanking. The order suggests to reverse those regulations that have made it impossible for banks to provide services to crypto firms and their executives, Operation Chokepoint 2.0.
The order has, according to reports, a provision that will allow crypto banks to purchase Federal Reserve master accounts, something that they require to provide services nationwide.
Stablecoin Regulation Update
There are some bipartisan senators in the Congress introducing a bill on stablecoin, whose steam has picked up pace after Trump’s latest support. The Senate Banking Committee Chairman Tim Scott vowed to consider fresh legislation, with priority to dollar-backed stablecoins regulation.
The legislation would enhance protection of consumers and advance financial inclusion by taking due regard to risk reduction and disclosure needs. According to one of the Democratic lead sponsors, Kirsten Gillibrand, the new bill will strengthen mechanisms for access to state regulation and insolvency issues.
Impacts of Regulatory Shifts
The hesitance of the UK Treasury to acquire a Bitcoin reserve comes at the opportune time when the realm of cryptocurrencies has found itself under the spotlight for risking financial stability. The British government continues to hold a massive majority of misplaced Bitcoins, but has chosen not to implement a state-sponsored reserve program. The situation is the reverse in America, where rumor concerning a strategic reserve of Bitcoins reached a frenzy.
Trump’s rumored crypto debanking executive order and the progressive stablecoin bill are proof of this shift in the US regulatory environment. The proposed policies would aim to improve the climate for cryptocurrency businesses to operate, thereby increasing more acceptance and innovation in the industry.
