The U.S. Senate voted to repeal the controversial SEC rule known as Staff Accounting Bulletin No. 121 (SAB 121). This decision, passed with the support of 60 senators against 38, now heads to the President’s desk for final approval.
SAB 121 required financial institutions to include clients’ cryptocurrency assets on their balance sheets as both assets and liabilities. This rule significantly increased capital requirements for banks, making it economically unviable for financial institutions to custody cryptocurrencies.
The repeal of this rule was supported by both Republicans and Democrats, including Senators Chuck Schumer, Cory Booker, and Kirsten Gillibrand. They stated that this decision is a victory for financial innovation and represents a critique of the Biden administration and SEC Chairman Gary Gensler for their approach to cryptocurrency regulation.
However, the White House has already announced its intention to veto this decision, citing the need to maintain a stable and predictable financial system. In a letter from the White House, it was argued that limiting the SEC’s ability to regulate cryptocurrencies could lead to financial instability and market uncertainty.
If the President’s veto is issued, it will require a two-thirds majority in both houses of Congress to override it.
For more information, you can read articles on… CryptoNews, American Banker, and Ledger Insights.
