Coinbase Urges End to SEC Staff Crypto Ownership Ban

Coinbase is urging the US Office of Government Ethics to lift a ban preventing SEC staff from owning cryptocurrencies. This ban, enforced since July 2022, is seen as a barrier to effective digital asset regulation. Coinbase suggests that practical experience is necessary for creating meaningful regulations. Additionally, waivers might be a viable interim solution for staff working on crypto issues.

Coinbase is pushing for an end to a ban imposed by the United States Office of Government Ethics (OGE) that prevents SEC staff from owning cryptocurrencies. In letters released on 25 April 2025, Coinbase representatives argue that these restrictions get in the way of the SEC’s ability to effectively regulate digital assets. They believe that practical experience is essential for crafting regulation that works.

The OGE’s Legal Advisory 22-04, issued on 4 July 2022, bars SEC employees from buying, selling, or using cryptocurrencies along with stablecoins. The advisory maintains this ban by stating that digital assets don’t fit the definition of ‘publicly traded securities’, which means they miss out on certain exceptions that apply to stocks, making the situation a bit confusing.

According to a Coinbase representative, SEC staff need firsthand exposure to cryptocurrencies to draft meaningful regulations. Gaining insights from direct engagement with the technology they regulate can provide vital information that might improve the overall regulatory framework.

Moreover, Coinbase officials have communicated these concerns directly to the SEC Chair and its commissioners. They highlighted that not allowing staff to use digital assets creates significant hurdles for the SEC’s Crypto Task Force. Despite a presidential directive for the SEC to propose comprehensive crypto regulations within 90 days, the current personnel are blocked from actively using the technology they are reviewing.

While the OGE could choose to lift this ban, Coinbase also suggested that the SEC should explore interim solutions. One potential approach mentioned was granting waivers to staff involved in crypto matters, which aligns with actions taken in other advisory contexts. The goal is to provide task force members with the chance to work directly with blockchain technology, thereby potentially strengthening their regulatory proposals.