The US House opposes the SEC’s crypto policy with new resolution

The U.S. House of Representatives has voted in favor of a resolution to overturn the Securities and Exchange Commission’s (SEC) 2022 Cryptocurrency Custodian Accounting Bulletin.

US President Joe Biden released a statement opposing the resolution and revealing a possible veto if the bill passes the Senate.

Democrats and Republicans join forces against the SEC

On May 8, 21 House Democratic representatives joined 207 Republican representatives in voting for HJRes.109 to rescind Staff Accounting Bulletin (SAB) 121. The bulletin requires all custodians of cryptocurrencies and other digital assets to recognize these assets as liabilities in their books of accounts.

AS reported from Bitcoinist, the rule prevented US banks from holding Bitcoin and other cryptocurrencies because it made their cryptocurrency business “unprofitable.” Republican Congressman Mike Flood said that “the SEC’s accounting standards for companies that store cryptocurrencies are unfair and hinder banks trying to provide such services.”

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Wednesday’s vote passed with 228 deputies in favor and 182 against. The bill now awaits a Senate vote to be passed to the President’s desk. If passed, the resolution would allow financial institutions to hold Bitcoin and other cryptocurrencies according to sustainable requirements.

Fox business reporter Elizabeth Terret stated that the bipartisan decision saw a “greater number of Democratic supporters in the House than expected.” However, the journalist believes that the bill “probably will not pass either the Senate or the presidency.”

SAT 121 was amazing criticized by important figures such as Patrick McHenry, chairman of the Financial Services Committee.

On Wednesday, the Committee’s chairman called the bulletin “one of the most egregious examples of the overregulation that defined Gary Gensler’s tenure at the SEC.” During his speech On the House floor, Speaker McHenry emphasized his support for the resolution, stating:

This bipartisan resolution represents an essential effort to protect consumers and promote innovation in digital asset markets. It is also critical to stop the SEC’s regulatory power grab and efforts to circumvent the Administrative Procedure Act.

Senator Cynthia Lummis has also expressed her disagreement with the “unnecessary” rule of SAB 121 on several occasions. On May 1, the pro-cryptocurrency senator criticized the US government’s “excessive intervention” towards the sector, revealing his concerns on the Department of Justice’s (DOJ) “hyper-aggressive” arguments against the industry.

President Biden supports SEC crackdown on cryptocurrencies

After the news of the favorable vote of the representatives of the American House, the White House took up the issue. According to the statement, the Biden administration “strongly opposes” passing the resolution.

Biden administration's statement regarding H.J.Res.109. Source: US White House

The president considers the bill “disruptive” against the SEC’s “work to protect investors in the cryptocurrency markets and to safeguard the broader financial system.”

Additionally, the statement argues that the SEC’s ability to ensure appropriate regulation in the future may be “limited” by invoking the Congressional Review Act.

The White House believes this “limits” the SEC’s ability to do so regular digital assets “would introduce substantial financial instability and market uncertainty.” Ultimately, the statement said President Biden would veto the resolution if passed by the Senate.

Total crypto market cap is at $2.23 trillion in the three-day chart. Source: TOTAL on TradingView

Featured image from Unsplash.com, chart from TradingView.com

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