A Hidden Barrier to Smart Crypto Policy: The Ethics Rule Blocking Tech Talent
Analysis
Price Impact
MedThe ethics rule impacts the crypto market indirectly by limiting the talent pool available for government roles in crypto regulation and policy. this could lead to slower regulatory developments or less effective policies.
Trustworthiness
HighThe article comes from a reputable source (coindesk) and cites a specific ethics rule (legal advisory 22-04) that directly restricts crypto holdings by government officials. the author's position as senior director of industry affairs at the blockchain association lends credibility.
Price Direction
NeutralThe news itself doesn't directly cause a price movement. the impact is more subtle, potentially slowing down regulatory clarity which could have long-term effects on market sentiment, but not necessarily a short-term bullish or bearish effect.
Time Effect
LongThe effects of the ethics rule are expected to unfold gradually over time. a change to the rule or the appointment of crypto-literate officials would take time to influence policy and have a market impact.
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Legal Advisory 22-04 , issued by the Office of Government Ethics in 2022, has flown largely under the radar as part of the Biden administration's restrictive approach to crypto. Yet its impact could be profound: it effectively bars anyone holding cryptocurrencies, tokens, or stablecoins from federal service. For an incoming administration that promised to restore American competitiveness in financial innovation, this presents an immediate challenge. Key agencies like Treasury, SEC, CFTC, and the Federal Reserve will need officials who understand both traditional finance and digital assets. But the current ethics guidance forces potential appointees and civil servants to make an impossible choice: divest entirely from the sector or stay out of public service. The irony is striking. A Treasury official can hold investments in JP Morgan while working on banking policy, but they can't hold any amount of bitcoin while working on digital asset regulation. A SEC lawyer can own mutual funds while reviewing securities cases, but they can't hold even $100 in stablecoins. This creates an artificial barrier to recruiting experts precisely when their expertise is most needed. As Senior Director of Industry Affairs at the Blockchain Association, I work with more than 100 member companies at the forefront of financial innovation. Many of our members include professionals with deep government experience who could contribute valuable insights to federal service. Yet under current rules, their expertise remains off-limits unless they're willing to completely divest from the industry they know best. There's a straightforward solution: The Office of Government Ethics should modify its guidance to allow de minimis holdings of digital assets, similar to existing rules for traditional financial instruments. This would maintain ethical standards while opening the door to badly needed expertise. Alternatively, the incoming administration could simply rescind the advisory via executive order - a quick win that would signal a more balanced approach to crypto policy. The stakes are high. As countries like Singapore, Switzerland, and the UAE race to establish clear regulatory frameworks for digital assets, the U.S. government needs officials who understand both the opportunities and risks. Maintaining an overly broad ethics rule doesn't just handicap agencies - it undermines America's ability to lead in financial innovation. For an incoming administration focused on effective governance and American leadership in technology, addressing this barrier should be an early, easy-to-achieve priority. The alternative is watching crucial positions go unfilled or, worse, filled by those with limited understanding of one of the most transformative technologies of our time. Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates. Dan Spuller Dan Spuller is Senior Director of Industry Affairs at the Blockchain Association. X icon ABOUT About Us Masthead Careers CoinDesk News Research CONTACT Contact Us Accessibility Advertise Sitemap POLICIES Ethics Privacy Terms of Use Cookie Consent Do Not Sell My Info DISCLOSURE Please note that our privacy policy , terms of use , cookies , and do not sell my personal information have been updated. CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies . CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. 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