Coinbase’s Chief Legal Officer, Paul Grewal, has urged regulators to lift the ban on SEC employees holding cryptocurrencies, arguing that firsthand experience with digital assets is crucial for effective regulation.
In a letter to the U.S. Office of Government Ethics (OGE), Grewal described the prohibition as “particularly egregious”, noting that most crypto activity does not involve securities. He emphasized that regulators must understand the technology they oversee, and allowing SEC staff to hold crypto would facilitate better policymaking.
Grewal also wrote to SEC Chair Paul Atkins, stating that the ban impedes the Crypto Task Force’s ability to develop appropriate regulatory recommendations. He suggested issuing waivers to SEC employees working on crypto-related matters, allowing them to engage with the technology firsthand.
Under Trump’s directives
The request comes at a critical time, as President Trump’s administration has directed regulators to submit recommendations for digital financial policies within 180 days. Grewal warned that nearly half of this timeframe has already passed, yet SEC staff remain unable to use the technology they are tasked with regulating.
Coinbase argues that potential conflicts of interest can be managed through appropriate safeguards, similar to those used in other advisory situations. The company believes that lifting the ban would enhance regulatory expertise, ultimately benefiting the broader crypto industry.
As discussions continue, the SEC’s response to this proposal will be closely watched by industry participants.
Shogun Lin
