Biden vetoes bill to overturn SAB 121, says standards are ‘necessary’ for crypto innovation
US President Joe Biden has vetoed a bill that would overturn a Securities and Exchange Commission (SEC) bulletin board that sets accounting standards for companies that store cryptocurrencies.
“Our administration will not support actions that jeopardize the well-being of consumers and investors,” President Biden said in a letter to the U.S. House of Representatives posted on the White House website. “Leveraging the potential benefits and opportunities of crypto asset innovation requires appropriate guardrails to protect consumers and investors.”
Earlier this month, the full House and Senate voted in favor of a bill to repeal the SEC Staff Accounting Bulletin, also known as SAB 121. house It previously passed the bill 228 to 182, with mostly Republicans but 21 Democrats signing on. A week later, senate Several Democrats, including Senate Majority Leader Chuck Schumer, voted in favor of the bill, with the vote being 60-38.
Overturning a veto requires a two-thirds majority vote in both houses of Congress.
veto plan
President Biden said he would do so. veto This bill is included in the ‘Administrative Policy Statement’ released by the White House last month. Specifically, the White House stated that “limiting the SEC’s ability to maintain a comprehensive and effective financial regulatory framework for crypto assets would result in significant financial instability and market uncertainty.”
Biden vetoed the bill before it passed the House and Senate in bipartisan votes. For example, the president vetoed a bill to overturn joint employer rules that passed the House and Senate by bipartisan margins in May. bloomberg legal.
The notice has sparked controversy over the past year due to concerns in the cryptocurrency industry that it could hinder banks from protecting digital assets. In order to record customer held cryptocurrency as a liability on the balance sheet, a company that stores the cryptocurrency is required.
The SEC said SAB 121 is a “non-binding employee guidance” that strengthens disclosures to investors.
“Time and time again, we have seen cryptocurrency companies fail and watched customers line up in bankruptcy court to get what they thought was legally theirs,” an SEC spokesperson said in a statement to The Block last month. “I saw it,” he said. “We also identified the risks to investors in the companies that protect these assets when they remain hidden on balance sheets. These disclosures provide investors with important insight into the level of risk taken by cryptocurrency custodians.”
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