Employees of the United States federal government must now disclose any cryptocurrency holdings they own after the US Office of Government Ethics issued new guidelines.
The new guidelines will mandate that some 2 million executive branch employees that own “virtual currency” report their holdings. Employees affected by the new mandate include the President, Vice President, the Executive Office of the President, and all 15 executive departments in the United States Cabinet, such as the Department of Defense and each branch of the US military.
The guidelines note that they “apply equally to other digital assets, such as “coins” or “tokens” received in connection with initial coin offerings or issued or distributed using distributed ledger or blockchain technology.”
According to the new rules, “filers report their holdings in a virtual currency if the value of the virtual currency holding exceeded $1,000 at the end of the reporting period or if the income produced by the virtual currency holding exceeded $200 during the reporting period. Filers are required to identify the name of the virtual currency and, if held through an exchange or platform, the exchange or platform on which it is held.”
The US Office of Government Ethics says it updated the guidelines because cryptocurrencies are “experiencing a surge in use and access,” causing government employees to seek “guidance from their ethics officials concerning their financial disclosure reporting obligations.”
Despite implementing such strictly enforced guidelines, the OGE “does not consider virtual currency a ‘real’ currency or legal tender.”
The notice explains that the requirements for reporting are different depending on if a cryptocurrency is deemed a security by the SEC, and that the OGE may need to update the guidelines further as “the nature of virtual currency becomes better defined.”
In related news, the SEC has said that bitcoin and ethereum are not considered securities in their current state. The lack of clear definitions on cryptocurrencies by other branches of the government are creating a confusing environment for retail investors and government employees seeking to disclose their holdings according to ethical standards.