The U.S. House of Representatives has passed a bill repealing the Securities and Exchange Commission's guidelines that prohibit banks from owning cryptocurrencies.
However, President #Joe Biden had previously warned that he would veto the new bill if it came to his desk.
On May 8, the House of Representatives passed a bipartisan bill called H. J. Res 109. The bill repeals the SEC's Special Accounting Bulletin (SAB 121), which requires banks to account for customers' crypto assets on their balance sheets, but does not apply to traditional assets such as securities.
Republican Congressman Mike Flood (who introduced the resolution) said that SAB 121 is unfair to banks that want to hold #cryptocurrencies .
Notably, 21 Democrats voted in favor of the bill, which, along with the unanimous 207 Republican votes, passed with a score of 228 to 182.
Despite the bill passing the House, President Joe Biden has said he will veto the new legislation.
In a May 8 statement, the White House said the House of Representatives "strongly opposes" the repeal of SAB 121. " It said it would disrupt the SEC's efforts to "protect investors in the cryptoasset market and ensure the safety of the financial system as a whole.
Limiting the SEC's ability to maintain a comprehensive and effective system of financial regulation of cryptoassets will lead to significant financial instability and uncertainty in the market.
SAB 121, which the SEC introduced in March 2022, includes regulatory accounting recommendations for institutions wishing to hold cryptoassets. Specifically, SAB 121 makes it virtually impossible for banks to hold cryptoassets for their customers.
U. S. lawmakers, including SEC Commissioner Hester Pearce, argue that SAB 121 jeopardizes the willingness of regulated banks to act as custodians of cryptocurrencies and treats #cryptocurrency assets differently than other assets.
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