The Office of Inspector General of the Securities and Exchange Commission, which oversees the financial regulator, reports that it is finding it difficult to hire cryptocurrency experts who are unwilling to sell their digital assets to secure employment.
“Many qualified candidates hold crypto assets, which the Office of the Ethics Counsel has determined would prohibit them from working on particular matters affecting or involving crypto assets,” the office stated in a report dated October 31. “This prohibition, according to SEC officials, has been detrimental to recruiting, as candidates are often unwilling to divest their crypto assets to work for the SEC.”
The regulator, which is engaged in many enforcement cases against significant exchanges like Binance and Coinbase, must contend with a limited pool of competent candidates and fierce competition from the private industry.
The reports are contained in a 25-page study that describes the performance and upper management issues facing the SEC. Cryptocurrency was mentioned as an “emerging area” with unique issues for the regulator, along with artificial intelligence.
As stated in the report, the SEC must constantly assess the health of the market and, where necessary, update and modify its knowledge, policies, procedures, and oversight instruments and endeavors to continue functioning as an effective regulator. The report added, “The SEC recognizes the rapid growth in crypto assets as one of several ‘evolutionary risks.'”
There is still no consistent caselaw for cryptocurrency, according to the report, which highlighted recent court judgments and referenced recent SEC litigation against Ripple Labs. As a result, “even judges in the same district can reach inconsistent decisions on similar facts or issues.”
The report stated, “It may take years before the law in this area crystalizes to the point where outcomes are reasonably predictable. This uncertainty may affect the SEC’s enforcement decisions and priorities.”