A vast majority of lawmakers in the United States Senate have successfully passed a joint resolution urging the Securities and Exchange Commission (SEC) to revoke a rule that impacts financial institutions involved in crypto-related businesses.
On May 16, in a vote of 60 to 38, U.S. Senators approved H.J.Res. 109, a resolution that nullifies the SEC’s Staff Accounting Bulletin No. 121. This particular rule mandates banks to include customers’ digital assets on their balance sheets, with corresponding capital set aside for them. Many lawmakers and industry leaders have criticized this measure, claiming that it hampers innovation.
The crypto advocacy group Blockchain Association expressed their satisfaction with the outcome, stating, “The tally, a remarkable 60 ‘Yeas’ in the Senate vote, sends a strong message that both chambers of Congress, regardless of political differences, unequivocally disapprove of this rule.”
Before the resolution gained approval in the U.S. House of Representatives, President Joe Biden expressed his intention to veto the bill, citing the need to protect investors in crypto-asset markets and safeguard the broader financial system. Should the U.S. President veto the legislation, it will be sent back to Congress and require a two-thirds majority vote to pass again.
The Blockchain Association argued against the possibility of a presidential veto, asserting that there is an increasing awareness among the voting public, especially young individuals, that cryptocurrencies are an issue that our elected officials should prioritize.
This vote in the U.S. Senate demonstrated an uncommon bipartisan move, with Democrats holding a narrow 51-49 majority. Senator Cynthia Lummis noted that this session of Congress marked the first time that “standalone crypto legislation” had been passed. The White House has not yet released a statement regarding the resolution’s approval.
Representative Mike Flood, the sponsor of the resolution, urged President Biden to reconsider his previous intent to veto the resolution, emphasizing the overwhelming opposition to SAB 121.
This joint resolution could potentially serve as an indicator for another crypto bill, the Financial Innovation and Technology for the 21st Century Act. This legislation aims to clarify the regulatory roles of the SEC and Commodity Futures Trading Commission in relation to digital assets. It successfully passed the committee stage in July 2023 and is expected to be introduced for a floor vote in the House in May.
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