President Joe Biden to veto bill allowing financial companies to store Bitcoin: White House
The administration of U.S. President Joe Biden has announced its position on the proposed bill, HJ Res. 109 allows highly regulated financial firms to act as custodians for Bitcoin and other cryptocurrencies.
Just in: 🇺🇸 US President Joe Biden’s administration says Biden will veto a bill that would allow highly regulated financial companies to keep custody. #Bitcoin And cryptocurrency. pic.twitter.com/aXx8aq1m0Z
— Bitcoin Magazine (@BitcoinMagazine) May 8, 2024
“The Administration strongly opposes the passage of HJ Resolution 109, which would interfere with the work of the Securities and Exchange Commission (SEC) to protect investors in the crypto asset markets and the broader financial system,” the President’s administration said. “If the President were to present HJ Resolution 109, he would veto it.”
HJRes. 109 is the SEC’s Staff Accounting Bulletin (SAB) No. 109, which imposes restrictions on financial institutions with respect to the custody of digital assets under the Congressional Review Act (CRA). We will overturn 121. By overturning SAB 121, this bipartisan resolution will remove obstacles that prevent highly regulated financial institutions and corporations from acting as custodians for Bitcoin and digital assets.
U.S. Representative Patrick McHenry, Chairman of the House Financial Services Committee, expressed support for overturning the SEC’s SAB 121, saying: In SEC. Through SAB 121, the Committee is seeking to direct how financial institutions and corporations protect Americans’ digital assets under the guise of so-called employee guidance.”
#see: Chairman @Patrick McHenry I speak in support of HJRes. 109 repeals SAB 121.
"This bipartisan resolution is an essential effort to protect consumers and foster innovation in digital asset markets."
Learn more 🔗https://t.co/jnIBJFHIPj
📺 Watch 👇 pic.twitter.com/fOxOh8DtWH
— Financial Services GOP (@FinancialCmte) May 8, 2024
“SAB 121 requires financial institutions and businesses that protect their customers’ digital assets to hold those assets on their balance sheets,” McHenry said. This means that banks will have to bear significant capital, liquidity and other costs under existing regulations. This essentially makes it prohibitively expensive for financial institutions to manage their customers’ digital assets. “This is a significant departure from the way banks have traditionally handled assets held on behalf of their customers.”
U.S. Representative French Hill also voiced support for HJ Res. 109 said, “Holding reserves against held assets is not standard financial services practice. Biden Admin’s SAB 121 is wrong and should be invalidated.”
It is not standard financial services practice to hold reserves against assets in custody.
The Biden administration’s SAB 121 is wrong and should be repealed. thank you @USRepMikeFlood For his great work leading the CRA resolution to reverse the SEC’s failures… pic.twitter.com/jwaTYWxhXs
— French Hill (@RepFrenchHill) May 8, 2024
“We are disappointed that President Biden has issued an executive policy statement to veto HJ Res 109, the joint resolution to repeal the SEC’s SAB (Staff Accounting Disclosure) 121,” said Cody, Chief Policy Officer, The Chamber of Digital Commerce. Carbone said. American advocacy group promoting the Bitcoin industry in DC. “SAB 121 effectively prohibits trusted custodians from managing digital assets.”
Earlier this year, Rep. Mike Flood and Rep. Wiley Nickel co-authored a bipartisan commentary on the SEC’s “flawed SAB 121 guidance.” The table expressed concerns that the lack of custody options for spot Bitcoin ETFs could lead to concentration risk.
