Key Takeaways
- President Biden vetoes resolution to overturn SEC crypto accounting policy.
- SEC's SAB 121 requires financial institutions to hold crypto on their balance sheets.
- Senator Wyden criticizes SAB 121 for creating inconsistent standards for crypto.
President Joe Biden vetoed a resolution to overturn the SEC’s controversial crypto accounting policy, fulfilling his earlier vow.
The resolution aimed to repeal the SEC’s Staff Accounting Bulletin 121 (SAB 121), which mandates financial institutions holding crypto for customers to record the assets on their own balance sheets. Critics argue that this guidance hampers financial institutions’ ability to work with crypto companies.
In his veto statement, Biden emphasized his commitment to consumer and investor protection, stating:
By virtue of invoking the Congressional Review Act, this Republican-led resolution would inappropriately constrain the SEC’s ability to set forth appropriate guardrails and address future issues.
He reiterated the importance of appropriate regulatory frameworks for the digital asset market.
Biden’s veto followed letters from banking groups and Congress members urging him to sign the resolution. They argued that SAB 121 prevents regulated banking groups from offering custody services for digital assets. Despite the resolution passing both chambers of Congress with substantial majorities, Biden remained firm in his stance.
Senator Ron Wyden (D-Ore.), a supporter of the resolution, criticized SAB 121 at CoinDesk’s Consensus 2024 conference, stating it creates an inconsistent standard for crypto compared to other financial assets.
