The US Senate has recently approved a bill that overturns SEC guidelines aimed at discouraging banks and large financial institutions from holding Bitcoin and other cryptocurrencies. The bill, which was already successful in the House last week, received a 60-38 vote in the Senate and is now on its way to President Biden for approval.
This legislation reverses an SEC accounting rule that requires banks to classify crypto assets held on behalf of clients as liabilities on their balance sheets. Pro-Bitcoin Senator Cynthia Lummis believes that the passage of this bill marks the start of a new era of support for the industry in the political landscape. She states, “The Senate passing a CRA overturning SAB 121 is a win for financial innovation and a clear rejection of the way the Biden administration and Gary Gensler have targeted crypto. It also signifies the first time that Congress has passed standalone crypto legislation. We are only just beginning.”
Republican Representative Mike Flood, the author of the resolution, explains that the bill aims to “protect consumers by removing obstacles that prevent heavily regulated banks from acting as custodians of digital assets.”
However, the Biden Administration has strongly promised to veto the legislation, arguing that it would “unreasonably limit the SEC’s ability to ensure appropriate safeguards and address future issues related to crypto assets, including financial stability.”
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