The Executive Office of US President Joe Biden has taken a firm stance on proposed legislation that would allow highly regulated financial firms to act as custodians for Bitcoin and other cryptocurrencies. The administration has announced that President Biden would veto the legislation, known as H.J. Res. 109, if presented to him.
The legislation in question, H.J. Res. 109, aims to overturn the SEC’s Staff Accounting Bulletin (SAB) No. 121, which currently imposes restrictions on financial institutions regarding the custody of digital assets. By nullifying SAB 121, the resolution would remove barriers that prevent highly regulated financial institutions from acting as custodians for Bitcoin and other digital assets.
US Congressman Patrick McHenry, Chairman of the House Financial Services Committee, has expressed support for overturning SAB 121, criticizing the regulatory overreach of the SEC under Gary Gensler’s leadership. McHenry argues that the current regulations make it cost-prohibitive for financial institutions to custody digital assets, deviating from traditional banking practices.
Other lawmakers, such as US Congressman French Hill, have also voiced their support for H.J. Res. 109, calling the SEC’s SAB 121 misguided and advocating for its nullification. The Chamber of Digital Commerce, an advocacy group promoting the Bitcoin industry in DC, has expressed disappointment in President Biden’s decision to veto the legislation, citing the impact of SAB 121 on trusted custodians managing digital assets.
In a recent development, H.J. Res. 109 has passed the house in a vote of 228 to 182 and will now move on to the Senate for further consideration. The outcome of this legislation could have significant implications for the regulation of digital assets and the role of financial institutions in the cryptocurrency market. Stay tuned for updates on this evolving story.
