Blockchain advocacy group the Digital Chamber has urged the Office of Government Ethics (OGE) to reconsider restricting staff of federal agencies from holding crypto assets, including stablecoins. In a letter dated November 13, the group noted that this restriction might negatively impact decisions on the US regulatory framework for crypto.
Instead of a blanket ban, as is currently the case, the Digital Chamber is calling for permission for federal employees to hold a minimum amount of crypto assets, which it notes will allow them to be better informed about the industry.
The letter stated:
“We strongly believe that allowing federal employees to hold a de minimis amount of crypto and allowing them to participate in crypto policy matters would support US leadership and foster a more informed and effective regulatory framework.”
The group further noted that federal agency staff who own digital assets will ensure more nuanced regulations because policymakers will better understand the technology. Therefore, the regulatory approach will prioritize consumer protection, financial stability, and technological advancements in a balanced way.
Allowing federal employees to hold crypto is equitable
Although the group did not specify the minimum amount of crypto that should be allowable, it recommended a threshold at which ownership will not pose a conflict of interest for policymakers. The Digital Chamber also noted that its requests align with current practices permitting federal employees to hold other financial assets in limited quantities.
According to the group, this will enable consistency in dealing with conflicts of interest for all financial products and treat them equitably.
It noted:
“Extending similar exemptions to minor cryptocurrency holdings would ensure equitable treatment across various asset classes, providing clearer guidance to employees and upholding fairness in ethical considerations.”
The request might enjoy political backing, particularly because several elected officials in the 2024 elections hold crypto or have alliances with crypto interest groups. The US vice president-elect, J.D. Vance, is reportedly a Bitcoin holder, and several addresses connected to Donald Trump hold several altcoins.
Stablecoin chances increase as Republicans maintain House control
Republicans have retained the majority in the House of Representatives after securing a majority of 218 members, according to the Associated Press. With the majority secured, the GOP will continue to head the House Financial Services Committee. However, the current chair, Rep. Patrick McHenry, will retire in January 2025, leaving a vacancy for a new head.
McHenry has been crypto-friendly in his efforts to pass a bill regulating stablecoins and the crypto industry as a whole. His departure is unlikely to slow down the efforts, as those considered to replace him, including Reps. French Hill, Andy Barr, Frank Lucas, and Bill Huizenga are all pro-crypto.
Meanwhile, the Digital Chamber released a report titled “How Stablecoins are Extending US Dollar Dominance” on Tuesday, calling on US lawmakers to pass the stablecoin bill. According to the group president Cody Carbone, the stablecoin bill is a low-hanging fruit that will enjoy bipartisan support, and the regulatory clarity will help ensure the US dollar stays dominant.
The group observed that the growing adoption of stablecoins is enough evidence to support the bill. It also recommended some inclusions into the bills, including allowing banks and non-banks to issue stablecoins and ensuring they are not treated like securities.
Presently, there are about three stablecoin bills in Congress: two in the Senate and one in the House. However, these proposed legislations would likely be consolidated before passage.
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