The Biden administration has firmly opposed bill HJ Res. 109, stating that it would allow highly regulated financial firms to act as custodians of cryptocurrencies, including Bitcoin. The administration argues that this move would undermine the Securities and Exchange Commission’s (SEC) efforts to protect investors and ensure the security of the financial system as a whole. The Executive Office of the President declared that President Biden would veto the bill if presented with it.
The proposed legislation seeks to repeal the SEC’s Staff Accounting Bulletin (SAB) No. 121, which sets strict guidelines for financial institutions regarding the custody of digital assets. The repeal, supported by both Democrats and Republicans, aims to remove barriers that currently prevent these institutions from acting as custodians of assets like Bitcoin.
Congressman Patrick McHenry, the chairman of the House Financial Services Committee, is among those in favor of the repeal. He criticizes the regulation as an example of excessive government control during Gary Gensler’s tenure at the SEC. McHenry argues that SAB 121 imposes significant costs on banks, making it impractical for them to offer custody services for digital assets.
Congressman French Hill also voiced support for HJ Res. 109, pointing out that it is not common practice for financial institutions to hold reserves against assets in custody. He believes that SAB 121 is a mistake and should be overturned.
On the other hand, Cody Carbone, the policy director at the Chamber of Digital Commerce, expressed disappointment with the president’s position. Carbone emphasized that SAB 121 effectively prevents trusted custodians from managing digital assets.
This development comes at a time when the debate over cryptocurrency regulation is intensifying, underscoring the need for clear regulations that enable the safe growth of the industry. Congressmen Mike Flood and Wiley Nickel have criticized the flawed SAB 121 guidance, highlighting the importance of regulated institutions in safeguarding spot Bitcoin ETFs and mitigating concentration risks.
At the time of writing, the price of BTC was $61,235.58, reflecting a 3% decrease in the last 24 hours.
Disclaimer: The views and opinions expressed in this article, including those of the author and individuals mentioned, are solely for informational purposes and do not constitute financial, investment, or other advice. Investing or trading cryptocurrencies carries the risk of financial loss.
Editor’s Choice: Discovery Reveals New US Government Bitcoin Wallet Holding Nearly 4 Thousand BTC Pro-XRP Legal Experts Predict Ripple Defeat in Latest Action
