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A Hidden Barrier to Smart Crypto Policy: The Ethics Rule Blocking Tech Talent
As federal agencies prepare for new executive leadership, an obscure ethics rule threatens to hamstring the incoming Trump administration’s ability to develop sound digital asset policy. 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.
Shares of Nasdaq-listed cryptocurrency exchange Coinbase (COIN) rose 43% this month, making the firm the top performer in the S&P 500 since it joined the index at the end of last month.
June’s run is already the stock’s best since November and caps three straight monthly gains. Coinbase’s shares reached their highest level since their public debut.
COIN hit a $382 high this week before enduring a slight correction, ending the week at $353 and seeing a slight 0.7% drop in after-hours trading to $351.
The wider S&P 500 index rose roughly 5% in June as geopolitical tensions eased.
Washington’s progress on the GENIUS Act, Congress’s first rulebook for dollar-pegged stablecoins, helped shift investor focus from trading fees to stablecoin revenue.
The bill brightened the outlook for Circle, whose shares hit a record high and saw its market cap near that of Coinbase this week.
Coinbase keeps all yield on USDC balances held on its platform and nearly half of other USDC income, equal to about 99 percent of Circle’s revenue, giving shareholders indirect exposure at no added cost, CNBC reported Friday, citing analysts including Citizens’ head of financial technology research Devin Ryan.
Trading, however, remains subdued. Average daily volume on Coinbase has drifted lower since April.
Robinhood (HOOD) has introduced micro futures on bitcoin (BTC), solana (SOL) and XRP in the United States., expanding its existing crypto futures offering for its nearly 26 million funded accounts.
Micro contracts need far less collateral than full-size futures, letting traders take directional positions while committing a smaller slice of capital.
The contracts offer traders more flexibility to bet on a cryptocurrency’s future price direction or hedge current positions given their smaller size.
The launch rounds out a futures suite that began with BTC and ETH in January. It also comes weeks after the firm closed its $200 million purchase of Bitstamp and finalized a $179 million deal for Canada’s WonderFi.
Robinhood’s data shows that crypto notional volumes have exploded upward over time, reaching $11.7 billion in May. The figure marks a 36% rise month-over-month, and a 65% growth year-over-year.
XRP climbed 5.5% to $2.19 in the last 24 hours after a trio of catalysts converged to help the cryptocurrency outperform the wider cryptocurrency market.
One of the catalysts was launch of XRP micro futures on Robinhood. The contracts offer traders more flexibility to bet on the cryptocurrency’s future price direction or hedge current positions given their smaller size.
Regulatory fog also thinned. On Friday, Ripple withdrew its cross-appeal in its long-running U.S. Securities and Exchange Commission (SEC) lawsuit. The SEC sued Ripple back in 2020 over its XRP sales, alleging these violated securities laws. The SEC is expected to drop its own appeal, leaving last year’s ruling, ordering Ripple to pay a $125 million civil penalty to the SEC, intact. The move could lift a lid that had kept some investors on the sidelines.
On-chain data rounded out the bullish setup. The XRP Ledger logged over a 1.1 million active addresses over the past week according to crypto analyst Ali Martinez, who cited Glassnode data.
XRP’s rise saw it outperform the wider crypto market, with the broader CoinDesk 20 (CD20) index rising 1.7% in the last 24 hours.
Coinbase Outpaces S&P 500 With 43% June Rise as Stablecoin Narrative Grows: CNBC
Robinhood Launches Micro Bitcoin, Solana and XRP Futures Contracts
Why is XRP Up Today? Trio of Catalysts Sees Token Outperform Wider Crypto Market
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