Blanche Lincoln’s famed derivatives legislation, which would basically prevent any big bank from ever trading CDS again, has already been chastised by Barney Frank. Now, a senior Treasury official has essentially delivered another blow to the Lincoln legislation.

Barney Frank just delivered a speech at Compliance Week’s annual conference in Washington D.C. and he seems to have confirmed what Goldman Sachs analysts told us yesterday - new legislation that forces banks to spin-off their derivatives business probably won't make it into the final financial reform bill.

Mark Brickell has worked for over a decade to keep government regulators out of the over-the-counter derivatives market. He hasn't given up yet. The former JPMorgan executive and who served as chairman of the International Swaps and Derivatives Assoc., is out today with a piece in the WSJ warning against the dangers of increasing government oversight of OTC derivatives. Swaps are benign and help big companies like McDonald's hedge its currency risk at a low cost, he argues.

So credit-default swaps have a pretty bad rap in the wake of that whole financial crisis. And people apparently aren't interested in trading things that some parts of the general public (otherwise known retail investors) blame for the aforementioned unpleasantness without actually understanding anything about CDS. The IntercontinentalExchange has an idea to change all of that: