Senate Urged to Swiftly Overturn SEC's 'Misguided' Crypto Rules

Following the U.S. House of Representatives passing a resolution to overturn the SEC’s Staff Accounting Bulletin 121 (SAB 121), Senator Cynthia Lummis has urged the Senate to do the same. The resolution aims to prevent regulatory overreach that makes it prohibitive for financial institutions to hold customers’ digital assets. Critics, including House Financial Services Committee Chair Patrick McHenry, argue that SAB 121 exemplifies excessive regulation under SEC Chair Gary Gensler.

‘Time for the Senate to Swiftly Overturn This Misguided Rule’

After the House of Representatives passed a resolution on Wednesday to overturn the U.S. Securities and Exchange Commission (SEC)’s Staff Accounting Bulletin 121 (SAB 121), Senator Cynthia Lummis (R-WY) is now urging the Senate to do the same.

In a statement on social media platform X on Thursday, the senator praised the House’s decision and emphasized the need for swift action in the Senate. She stressed:

We cannot allow the administration to regulate tools for financial freedom out of existence. Time for the Senate to swiftly overturn this misguided rule.

On Wednesday, 21 Democrats and 207 Republicans successfully passed the resolution to nullify the SEC’s rules under SAB 121. Representative Warren Davidson (R-OH) commented on X: “I’m grateful digital asset privacy and property rights unite Republicans. I applaud the Democrats who took the tough vote to be right on policy.” The lawmaker added: “Hopefully, this serves as a floor for future bipartisan work to ban central bank digital currency (CBDC), protect self-custody, define market structure, [and] properly recognize stablecoins.”

Noting that SAB 121 is “one of the most glaring examples of the regulatory overreach that has defined Gary Gensler’s tenure at the SEC,” House Financial Services Committee Chair Patrick McHenry (R-NC) explained: “SAB 121 requires financial institutions and firms that are safeguarding their customers’ digital assets to hold those assets on their balance sheet, making it cost prohibitive to do so.” He emphasized that the resolution passed by the House “will allow consumers to hold their digital assets in one of the safest ways possible — through highly regulated banks and other financial institutions.”

On Thursday, Rep. Tom Emmer (R-MN) shared on X: “Gary Gensler’s SEC needs significant reforms. I was proud to cosponsor three pieces of legislation, authored by Rep. Ann Wagner to 1) improve its process for drafting and adopting regulations, 2) increase SEC transparency to Congress, and 3) improve SEC cybersecurity.” The lawmaker continued:

Under Gary Gensler, the SEC has strayed from its statutory mission to protect investors, maintain fair, orderly, and efficient markets, and improve capital formation. These three bills will force the SEC to get back on track.

The White House, however, has issued a statement in support of the SEC, stating that if President Joe Biden were presented with the resolution, he would veto it.

Do you think the Senate will approve the resolution to overturn the SEC’s “misguided” crypto rules? Let us know in the comments section below. #Write2Earn