This week, the House of Representatives witnessed the passage of two bills that could have a substantial impact on the cryptocurrency industry. Advocates for cryptocurrency have welcomed this development, but there is uncertainty surrounding the potential veto by President Joe Biden of one of these bills.
On May 23, the House presented a joint resolution, H.J.Res.109, to President Biden. This resolution urges the Securities and Exchange Commission (SEC) to abolish a rule that affects financial institutions dealing with cryptocurrency firms. Specifically, the rule in question is the SEC’s Staff Accounting Bulletin (SAB) No. 121, which requires banks to include customers’ cryptocurrency on their balance sheets, along with maintaining capital against them.
Before the passage of the resolution in both the House and the Senate, President Biden had expressed his intention to veto it. He argued that the legislation would unreasonably restrict the SEC’s ability to establish necessary guidelines and address future issues related to crypto-assets.
Despite the President’s initial stance, the political tide has shifted in recent weeks. With 21 Democrats in the House joining forces with Republicans to pass H.J.Res.109, and a similar bipartisan result in the Senate with a 60 to 38 vote, the approach to cryptocurrency regulation seems to be changing.
Prior to the House voting on the Financial Innovation and Technology for the 21st Century (FIT21) Act, the White House expressed opposition to the bill, but did not explicitly threaten to veto it. Following the bill’s passage in the House, more than 70 Democrats and a majority of Republicans showed their support, signaling a potential shift in policy.
Moe Vela, former Director of Administration for then-Vice President Biden, emphasized the bipartisan nature of H.J.Res.109 as a clear indication of disagreement with the SEC’s approach to cryptocurrency oversight. He urged the Biden Administration to engage with the cryptocurrency industry to develop regulations and policies that prioritize consumers and support industry growth.
With the ball now in President Biden’s court, the cryptocurrency community eagerly awaits his decision within the next ten days, excluding Sundays, which is the maximum allowable time for signing or vetoing a bill. Notably, the resolution landed on the President’s desk on the same day that the SEC approved spot Ether listing and trading on U.S. exchanges for the first time.
In conclusion, the conflict over the potential overturning of the SEC’s cryptocurrency rule has ignited a fierce battle, with implications that could significantly shape the future of the cryptocurrency industry. As President Biden weighs his decision, the landscape of cryptocurrency regulation stands at a crucial crossroads.
