US Lawmakers Concerned About Crypto Companies Hiring Government Officials

Several progressive politicians want to know whether and how banking authorities would reduce the number of employees leaving to work for crypto businesses.

Sen. Elizabeth Warren, D-Mass., and Rep. Alexandria Ocasio-Cortez, D-N.Y., spearheaded the inquiry, according to one of the October 24 letters to several financial organizations and government departments.

“We write seeking information about the steps your agency is taking to stop the revolving door between our financial regulatory agencies and the cryptocurrency (crypto) industry.

The crypto sector has rapidly escalated its lobbying efforts in recent months, spending millions in an attempt to secure favorable regulatory outcomes as Congress and federal agencies work to craft and enforce rules to regulate this multi-trillion dollar industry.”

Reps. Jess “Chuy” Garca (D-Ill.), Rashida Tlaib (D-Mich.), and Sheldon Whitehouse (D-RI) signed on to the letter.

The organization submitted the letters, which included requests for information on each agency’s ethical guidelines regarding personnel joining private-sector enterprises with ties to the department or regulator from which they had resigned.

Letters were sent to the Treasury Department, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve, the Federal Deposit Insurance Commission, the Office of the Comptroller of the Currency, and the Consumer Financial Protection Bureau, requesting a response by November 7. It adding:

“Just as powerful Wall Street interests have long exercised their influence over financial regulation by hiring former officials with knowledge of government’s inner workings, crypto firms appear to be pursuing the same strategy in order to secure ‘a regulatory system to the industry’s exact specifications.’

Indeed, hiring former regulators and government officials provides the crypto industry with a sense of legitimacy that is ‘a vital currency for an industry that designs many of its products to skirt regulatory scrutiny.’”

According to the lawmakers, over 200 government personnel have departed to work as advisers, board members, investors, lobbyists, legal counsel, or in-house executives in the digital asset business.

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