Concerns were mounting as more U.S. lawmakers were venturing into the world of cryptocurrency back in 2021, raising questions about the need for regulations in the rapidly growing market. As per an analysis conducted by data provider 2iQ Research, 21 members of Congress or their immediate family engaged in trading cryptocurrencies, crypto-investment products, and stocks of crypto-related businesses, amounting to an estimated $1.8 million from the start of 2021 till the mid of 2022. Notably, seven of these members served on committees that held key regulators accountable in the Senate or House. These findings by 2IQ Research came at a time when there was a broader pushback against lawmakers trading securities while holding office.
Richard Painter, former chief White House ethics lawyer and University of Minnesota's law professor, expressed concerns about the implications of lawmakers' involvement in the crypto market. He emphasized the need for public confidence in Congress to create appropriate rules for the right reasons, stating that this situation could undermine public confidence in the crypto market.
Among the assets traded by lawmakers were shares of Coinbase Global Inc. (COIN:US) and Block Inc. (SQ:US) owned by members from both the Democratic and Republican parties. It is worth noting that Republicans were the only members of Congress to report direct ownership of cryptocurrencies, including Bitcoin (BTC:US), and lesser-known coins like Basic Attention Token (BAT:US) and Stellar Lumens (XLM:US). Representative Barry Moore from Alabama even held Ethereum (ETH:US) and the meme-inspired Dogecoin (DOGE:US) in his portfolio.
Interestingly, out of the total 21 lawmakers, members of the House reported the highest number of crypto-related asset trades. the lists included quite a few famous names such as Representatives Ro Khanna, Ed Perlmutter, Josh Gottheimer, and Marie Newman.
Even though crypto trading by members of Congress is legal, there has been a lot of criticism in the past related to this. Putting regulations in place and transparency in trading may help to ease this pressure by critiques.