Bitcoin Tops $42,000 as Biden's Executive Crypto Order Promises More of the Same

The new White House directive regarding cryptocurrency regulation almost guarantees no new crypto legislation this year.

President Biden's long-awaited executive order regarding cryptocurrency regulation was issued today. As expected, it was light on specifics and heavy on future promises regarding crypto.

Highlights and lowlights of Biden's executive order

We've known for months that Biden's edict was going to charge most of the agencies within the executive branch to hunker down and see how their respective realms of responsibility might factor into the much-needed regulatory calculus of crypto.

The most noteworthy highlight of the president's new directive was the six areas of focus that the cross-agency study group will tackle. Those "key priorities" were outlined in the White House fact sheet and include consumer and investor protection; financial stability; illicit finance; U.S. leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation.

However, the unavoidable lowlight of this announcement is that no real cryptocurrency regulation is likely to occur this year.

Crypto regulation reality -- it's not likely to happen this year

You have to figure that it's going to take between three to five months for each federal agency to compile their respective findings and recommendations and cobble them into a report. Meanwhile, members of Congress will have begun campaigning for critical midterm elections throughout the summer recess and will largely ignore crypto policy because voters simply don't care enough about it right now.

According to a report from Pew Research Center last month, the top three voter concerns are the economy, healthcare costs, and the COVID-19 pandemic. Interestingly, Pew ranked the top-18 most important issues to voters -- cryptocurrencies nor crypto regulation made the list.

So, once the end of summer rolls around and Congress reconvenes, the White House will most likely still be collating and compiling the best crypto regulatory recommendations from the federal agencies triggered by today's executive order. Once those federal agency findings and recommendations are locked down it's unclear if President Biden would push another executive order to enact that crypto policy without Congress or just send the composite document to the federal legislature to address after the midterm elections.

It's possible that Biden could try to implement the first batch of crypto regulations on his own to bolster his latest approval ratings, which are in the mid-40% range. According to Gallup, sitting presidents with approval ratings lower than 50% tend to lose 37 congressional seats on average during midterm elections. That's probably something the White House wants to avoid.

Bitcoin is up 10%, exceeding $42,000 on the news

The largest crypto by market cap is trading up at $42,362.15 at the time of writing according CoinMarketCap.com. After trending down for several days, it's not clear why Bitcoin's price popped more than 10% on the news of Biden's executive order this morning. It may suggest a willingness by crypto investors to embrace the need for regulation as a way to calm fears of non-crypto investors who are waiting on the sidelines and to spur broader adoption.

We'll have to see if this latest step by the White House actually leads to sustainable growth for crypto markets by providing much-needed cryptocurrency regulation or if it's only political theater that offers more rhetoric than regulatory responsibility.