US Ban Crypto-Owning Government Officials From Working on Regulation
- The United States OGE issued the legal advisory today.
- Employees holding cryptocurrency (s) will be banned from working on crypto regulations and policies.
- The policy, however, does not prohibit them from investing in listed crypto and blockchain companies.
In a new order issued by the United States Office of Government Ethics, government employees who are actively investing in cryptocurrencies or are found holding any will be banned from participating in developing regulations and policies focusing on cryptocurrencies.
Exceptions for Some
The advisory notice also highlighted that though the ban is applicable, it only applies with a de minimis exemption.
This exemption allows owners to still invest in cryptocurrencies through publicly-traded securities and mutual funds of companies involved with crypto and blockchain services. This includes all kinds of cryptos and stablecoins.
This does not mean that government employees cannot own cryptocurrencies at all, they can, but at the cost of losing out on the opportunity to work on crypto-related policies.
However, they can still work on such policies if they divest their investment from crypto into investment options that do not hold the policies’ interest.
Further explaining the same, the notice read,
“An employee who holds any amount of a cryptocurrency or stablecoin may not participate in a particular matter if the employee knows that particular matter could have a direct and predictable effect on the value of their cryptocurrency or stablecoins.”
However, even for the ones who can invest in crypto-affiliated stock index listings, the cap is set at $50k, beyond which the de minimis exemption becomes invalid.
Crypto Investors Take a Hit
While the Biden administration is focusing on developing regulations for cryptocurrencies after the POTUS signed the executive order for the same, the crypto market itself isn’t in the best shape right now.
The total market cap of all cryptocurrencies is struggling to recover to $1 trillion, and the suspended bearishness is affecting crypto companies.
After Harmony almost went bankrupt a while ago, Voyager Digital officially filed for Chapter 11 bankruptcy a week after suspending the platform’s withdrawal, trading, and deposit services.
Thus even without the order from the US GOE, it would have only taken a bit longer for these investors to exit the market, just as many other investors are currently doing.