Regulation
Lawmakers Push Biden to Pass Revised SAB 121 to Allow Regulated Financial Firms to Hold Cryptocurrencies
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House Financial Services Committee Chairman Patrick McHenry (R-NC) and Senator Cynthia Lummis (R-WY) released a letter urging President Joe Biden to reconsider vetoing the bipartisan resolution of Congressional Review Act (CRA) Overturning Securities and Exchange Commission (SEC) Staff Accounting Bulletin 121 (SAB 121). SAB 121 makes it prohibitive for highly regulated financial firms to store Bitcoin and cryptocurrencies.
“Given the overwhelming bipartisan votes, we urge you to sign HJ Res. 109 into law or work with the SEC to revoke the staff guidance,” the letter states. “Revoking SAB 121 is within the SEC’s authority and there are broad precedents for reviewing a personnel accounting bulletin.”
This CRA passed the Senate 60-38 and the House 228-182. McHenry said it protects essential custodial services and consumers. Senators Kirsten Gillibrand (D-NY), Representatives French Hill (R-AR), Ritchie Torres (D-NY) and others also urged regulators to declare SAB 121 unenforceable after the Government Accountability Office deemed it a rule under the CRA.
On November 15, McHenry, Lummis, Flood, Nickel, Gillibrand, Hill and Torres made this argument to federal regulators. On February 1, Lummis, Flood, and Nickel introduced the bipartisan CRA.
AS reported After the Crypto Briefing, Biden’s veto was almost certain, after the American president expressed his intentions, citing the need to protect investors and the financial system. If a presidential veto occurred, Congress would need a two-thirds majority to override it.
However, recent developments in the US regulatory landscape could increase the chances that Biden will decide not to veto the law. According to Bloomberg ETF analyst Eric Balchunas, the sudden change in stance seen by the SEC towards spot approval of the Ethereum ETF was motivated by “political issues.”
Furthermore, presidential candidate Donald Trump has recently shown a pro-crypto approach in his campaign, and Biden may want to stay on the good side of this share of the electorate.
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