What Lies Ahead for Crypto After Biden Unexpectedly Vetoes SEC’s Crypto Guidance?
President Joe Biden has vetoed a congressional resolution that sought to overturn the controversial Staff Accounting Bulletin 121 (SAB121) issued by the Securities and Exchange Commission (SEC). This move has sparked a debate about the future of digital asset regulation and its impact on financial institutions, leaving stakeholders in the crypto market wondering what this means for them.
President Biden’s veto holds significant weight in the ongoing struggle over cryptocurrency regulation, as it goes against bipartisan support in Congress to repeal SAB121. The president defended his decision by emphasizing the need to protect consumers and investors, stating that his administration will not support measures that compromise their well-being.
SAB121, introduced by the SEC in 2022, has faced criticism from both the crypto industry and banks. It has been accused of imposing high compliance costs that make it prohibitively expensive for banks to offer digital asset services. This has hindered the scaling of such services and limited Americans’ options for storing digital assets in traditional banks, according to proponents of the congressional resolution.
The resolution to repeal SAB121 received notable support from 11 Democrats in the Senate and passed with a 228-182 vote in the House. However, President Biden’s veto has halted these efforts to overturn the SEC’s guidance.
In his veto statement, President Biden stressed the importance of robust consumer and investor protections, as well as the responsible safeguarding of the benefits of crypto-asset innovation. He expressed a willingness to collaborate with Congress in creating a comprehensive and balanced regulatory framework for digital assets. While the White House had previously opposed House-passed legislation on digital asset regulation, it showed a willingness to negotiate future regulations rather than issuing a full veto threat.
Lawmakers have reacted to President Biden’s veto with disappointment. U.S. House of Representatives member Mike Flood expressed his disappointment on Twitter but emphasized that this isn’t the final word on SAB121. He believes that digital assets and cryptocurrency are here to stay and are crucial for America’s financial future. Flood called on banks to work with regulators to provide the same services for digital assets as they do for other asset classes. He pledged to continue working with his colleagues to find ways to end SAB121 and counter the anti-crypto agenda of SEC Chair Gensler.
As the debate continues, stakeholders in the crypto market will closely monitor the developments surrounding digital asset regulation, knowing that this decision by President Biden could have a significant impact on the industry’s future.