President Biden has followed through on a promise to veto SEC-related crypto legislation that recently passed the House and Senate.
The bill would have reversed guidance from the SEC that says certain companies should label crypto assets as liabilities on their balance sheet, even if they are simply holding the assets on behalf of customers.
A group of 21 Democrats supported the Republican-led legislation in the House, which passed in a 228 to 182 vote. Eleven Democrats supported the legislation in the Senate, which passed 60-38.
In a letter to the House of Representatives, President Biden says the removal of the guidance would hinder the SEC’s ability to implement safeguards and protect investors.
“SAB 121 reflects considered technical SEC staff views regarding the accounting obligations of certain firms that safeguard crypto-assets. By virtue of invoking the Congressional Review Act, this Republican-led resolution would inappropriately constrain the SEC’s ability to set forth appropriate guardrails and address future issues.
This reversal of the considered judgment of SEC staff in this way risks undercutting the SEC’s broader authorities regarding accounting practices. My Administration will not support measures that jeopardize the well-being of consumers and investors.
Appropriate guardrails that protect consumers and investors are necessary to harness the potential benefits and opportunities of crypto-asset innovation. My Administration is eager to work with the Congress to ensure a comprehensive and balanced regulatory framework for digital assets, building on existing authorities, which will promote the responsible development of digital assets and payment innovation and help reinforce United States leadership in the global financial system.”
President Biden’s veto comes with Bitcoin and crypto in both the political and regulatory spotlight.
Former President Trump began accepting donations in crypto last week, vowing to support the industry and investors’ rights to self-custody their assets.
Meanwhile, the SEC abruptly reversed course on Ethereum ETFs, paving the way for their imminent launch.
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