United States Senate passes resolution urging SEC to repeal rule on cryptocurrency firm deals

The United States Senate has passed a joint resolution calling on the Securities and Exchange Commission (SEC) to repeal a rule that affects financial institutions engaged in business with cryptocurrency firms. The resolution, known as H.J.Res. 109, seeks to nullify the SEC’s Staff Accounting Bulletin No. 121, which mandates that banks include customers’ digital assets on their balance sheets. Critics argue that this rule stifles innovation in the cryptocurrency sector.

The resolution passed the Senate on a vote of 60 to 38. This marks the first instance of standalone cryptocurrency legislation this session of Congress and represents an unusual bipartisan move, with a split of 51-49 in favor of Democrats. The resolution could have broader implications for the regulation of digital assets, particularly regarding the Financial Innovation and Technology for the 21st Century Act.

Before the resolution was passed in the House of Representatives, President Joe Biden stated his intention to veto the bill. He cited the need to protect investors in the cryptocurrency market and secure the overall financial system as his rationale. If the President does veto the legislation, it will return to Congress and require a two-thirds majority vote to pass again.

The Blockchain Association, a leading industry group, argues against the threat of a presidential veto, highlighting a growing awareness among the public, especially young people, regarding the significance of cryptocurrencies. They emphasize the importance of elected officials acknowledging and understanding the implications of cryptocurrencies.