The resolution received bipartisan support in both the Senate and House of Representatives.<\/p>\n
The U.S. Senate passed a joint resolution seeking to overturn an accounting rule decreed by the Securities and Exchange Commission (SEC) that could have disastrous implications for financial institutions providing cryptocurrency custody services.<\/p>\n
On May 16, the Senate\u00a0voted<\/a>\u00a060 to 38 in favor of repealing the SEC\u2019s Staff Accounting Bulletin (SAB) No. 121. The resolution, H.J. Res. 109,\u00a0garnered<\/a>\u00a0bipartisan support, with 11 Democrats joining all but two abstaining Republican senators to reject the rule despite Democratic party leaders opposing the resolution.<\/p>\n \u201cLimiting the SEC\u2019s ability to maintain a comprehensive and effective financial regulatory framework for crypto-assets would introduce substantial financial instability and market uncertainty,\u201d the White House\u00a0said<\/a>\u00a0in a statement published on May 8. \u201cIf the President were presented with H.J. Res. 109, he would veto it.\u201d<\/p>\n The move follows the U.S. House of Representatives similarly voting to pass the resolution with a count of 228 to 182 on May 8, 2023, with 21 Democrats backing the resolution. However, the vote fell short of the two-thirds majority needed to override a presidential veto.<\/p>\n Should the President issue a veto, the legislation will return to Congress and would require a two-thirds majority vote in favor to pass.<\/p>\n On April 11, 2022, the SEC released\u00a0SAB 121<\/a>, mandating that companies offering custody services for crypto assets must include these assets on their balance sheets. The bulletin was widely panned by industry advocates and Republican lawmakers, with the rule posing major capital and accounting complications for banks working with crypto clients.<\/p>\n Following the passage of H.J Res. 109, Republican Senator, Cynthia Lummis slammed the SEC for seeking to legislate \u201can industry they do not regulate\u201d through an SAB.<\/p>\n \u201cThis is a win for financial innovation and a clear rebuke of the way the Biden administration and Chair Gary Gensler have treated crypto assets and marks the first time both chambers of Congress have passed standalone crypto legislation,\u201d Lummis said.<\/p>\n Republican Representative, Wiley\u00a0Nickel, took aim at\u00a0the SEC\u2019s effort to bypass its\u00a0formal rulemaking process<\/a>\u00a0in an attempt to regulate the U.S. cryptocurrency industry.<\/p>\n “Today’s Senate vote to repeal SAB 121 sends a clear bipartisan message: Congress will not stand idly by as Gary Gensler and the SEC deliberately sidestep the statutory rulemaking process and overstep their regulatory authority,\u201d Nickel said.<\/p>\n Blockchain Association, a crypto advocacy organization, also\u00a0urged<\/a>\u00a0the Whitehouse to take note of the \u201coverwhelming\u201d bipartisan support for the resolution.<\/p>\n \u201cThe threat of a presidential veto denies the fact that there is a growing awareness\u2026 that crypto is something our elected officials should care about,\u201d Blockchain Association tweeted. \u201cConsumers shouldn\u2019t be punished simply for embracing new technologies.\u201d<\/p>\nStifling innovation or protecting consumers?<\/h2>\n