The ownership of crypto by government officials can create a conflict of interest

That's right — the ownership of crypto by government officials can create a conflict of interest, and this is an issue mentioned by many analysts, oversight organizations, and the American press.

🔍 Why could it create a conflict of interest?

1. They may be involved in enacting policies that directly affect the assets they hold

If an official owns Bitcoin or altcoin, then the decisions they make — such as tax regulations, trading regulations, new laws on crypto, or national financial strategies — could cause crypto prices to rise or fall.

→ This creates an incentive for them to implement policies beneficial to their personal portfolios, rather than the common good.

2. Risk of policy manipulation (policy manipulation)

If the government is preparing to announce something related to crypto (such as legalization, easing regulations, creating a national Bitcoin fund...), officials may:

• buy in before announcements (insider trading),

• or sell before issuing negative policies.

Crypto is highly volatile, so even a small change in regulation can yield significant profits.

3. Lack of transparency regarding insider information (non-public information)

The White House, SEC, Department of Treasury, and many agencies often discuss management plans before announcement.

If officials have crypto assets, they may use insider information that the public does not have.

4. The impact on public trust

If the public sees that the writer of crypto policies is also investing in crypto, there will be doubts about:

• the objectivity of the law,

• whether the policy serves personal interests.

📌 Recent example (from a public report by a watchdog organization in the US)
An investigative report stated that 19 White House officials collectively own between $875,000 and $2.35 million in crypto, of which 16 hold Bitcoin.

→ This is controversial as it coincides with the US government building a 'strategic Bitcoin reserve fund' and a new legal framework for crypto.

🛡️ Is there a way to reduce the risk of conflicts of interest?

Proposed measures often include:

• require transparency in disclosing crypto assets,

• require officials to divest crypto assets before participating in law-making (divestment),

• or place assets in a blind trust (blind trust),

• prohibit officials from trading crypto when they possess insider information.