The working group will develop a federal regulatory framework for digital assets, including stablecoins. Credit: ungvar/ Shutterstock.

US President Donald J Trump has signed an executive order, restricting US agencies from issuing or endorsing central bank digital currencies (CBDCs) both within the nation and on the international stage.

CBDCs are digital currencies issued by central banks.

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In issuing the ban, the executive order expressed concerns that CBDCs “threaten the stability of the financial system”.

Besides, the order aims to establish the presidential working group on digital asset markets .

The working group will develop a federal regulatory framework for digital assets, including stablecoins, and assess the creation of a national digital assets stockpile.

Chaired by the White House AI & Crypto Czar, it will include the Secretary of the Treasury, SEC chairman, and other relevant agency officials.

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In December, Trump named venture capitalist and former PayPal executive David Sacks as the crypto and AI czar, reported Reuters.

The latest order rescinds the previous administration’s Digital Assets Executive Order and the Treasury Department’s Framework for International Engagement on Digital Assets.

In doing so, President Trump looks to fulfil his promise to make the US the “crypto capital of the planet”, the White House fact sheet said.

The Order stated: “Except to the extent required by law, any ongoing plans or initiatives at any agency related to the creation of a CBDC within the jurisdiction of the US shall be immediately terminated, and no further actions may be taken to implement such plans or initiatives.”

It also stressed on supporting open access to banking services for law-abiding citizens as well as private-sector entities.

The executive order includes a severability clause to ensure that if any section is invalidated, the remaining provisions will continue to be in force.