President Joe Biden will veto a bill that allows financial firms to act as custodians for Bitcoin and other cryptocurrencies. The proposed legislation, H.J. Res. 109, would overturn the SEC’s Staff Accounting Bulletin (SAB) No. 121. This bulletin imposes restrictions on financial institutions regarding the custody of digital assets, under the Congressional Review Act (CRA).
“The Administration strongly opposes passage of H.J. Res. 109, which would disrupt the Securities and Exchange Commission’s (SEC) work to protect investors in crypto-asset markets and to safeguard the broader financial system,” The Executive Office of The President stated. “If the President were presented with H.J. Res. 109, he would veto it.”
Furthermore, H.J.Res. 109 has already received plenty of bipartisan support. The bill would remove roadblocks that prevent highly regulated financial institutions from acting as custodians for digital assets like Bitcoin.
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Despite President Biden’s Veto, Support In Congress Remains for New Bill
US Congressman Patrick McHenry, Chairman of the House Financial Services Committee, expressed support for overturning the SEC’s SAB 121. “Staff Accounting Bulletin, or SAB, 121 is one of the most glaring examples of the regulatory overreach that has defined Gary Gensler’s tenure at the SEC,” McHenry said in a hearing. “Through SAB 121, the Commission is trying to dictate how financial institutions and firms safeguard Americans’ digital assets under the guise of so-called staff guidance.”
Additionally, US Congressman French Hill also spoke out in support of H.J. Res. 109, saying that “Holding reserves against the assets held in custody is NOT standard financial services practice. The Biden Admin’s SAB 121 is misguided and should be nullified.”
Again, the bill hasn’t been presented yet to President Biden. However, knowing his stance on the bill ahead of time isn’t good news for financial entities looking to hold Bitcoin and other top crypto assets.