Regulation
When will the House of Representatives consider the cryptocurrency regulation bill that Biden vetoed?
The U.S. House of Representatives is set to reconsider a bill on or before July 9 which previously faced the hammer of a presidential veto in May. The bill seeks to overturn a controversial Securities and Exchange Commission (SEC) directive known as Staff Accounting Bulletin No. 121 (SAB 121). This directive, which has angered many, advises financial institutions that hold cryptocurrencies on behalf of customers to treat these activities as their own in their balance sheets.
Biden’s Cryptocurrency Veto Under Threat
President Joe Biden exercised his veto power decisively against the bill, citing concerns about potential limits on the SEC’s regulatory capabilities. According to Biden, such limitations could undermine the establishment of essential safeguards for managing future financial scenarios and ensuring consumer protection.
His veto, expressed through a White House statement, underscored the administration’s stance against jeopardizing the well-being of consumers and investors, marking a significant moment of contention between the executive branch and cryptocurrency advocates.
How much support does Crypto Bill need?
Initially, the bill gained bipartisan support, passing both the House and the Senate. However, the challenge now is to muster a two-thirds majority in both chambers to override the president’s veto. – easier said than done in a politically divided environment. Supporters of the measure argue that SAB 121 unnecessarily complicates and discourages traditional financial entities from providing cryptocurrency custody services, which could stifle innovation and investment in the sector.
The SEC’s introduction of SAB 121 in March 2022 was met with strong opposition from many quarters, including House Majority Leader Tom Emmer called it “illegal” and a “violation” of the SEC’s statutory mission. Critics argue that the guidelines go too far, imposing stringent requirements on how banks should handle cryptocurrencies, potentially chilling the burgeoning cryptocurrency custody market.