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  • Writer's pictureBrandon Zemp

President Biden Vetoes Crypto Bill: Would Have Eliminated Controversial SEC Policy

President Biden Vetoes Crypto Bill Protecting SEC

President Biden has fulfilled his commitment to veto the crypto legislation related to the SEC that was recently approved by both the House and Senate.

The bill aimed to overturn the SEC's guidance that requires specific companies to classify crypto assets as liabilities on their balance sheet, even when they are just holding the assets for customers.

President Biden wrote a letter to the House of Representatives expressing that eliminating the guidance would impede the SEC's capacity to enforce protections and ensure the safety of investors.

“SAB 121 reflects considered technical SEC staff views regarding the accounting obligations of certain firms that safeguard crypto-assets. By virtue of invoking the Congressional Review Act, this Republican-led resolution would inappropriately constrain the SEC’s ability to set forth appropriate guardrails and address future issues.

This reversal of the considered judgment of SEC staff in this way risks undercutting the SEC’s broader authorities regarding accounting practices. My Administration will not support measures that jeopardize the well-being of consumers and investors.

Appropriate guardrails that protect consumers and investors are necessary to harness the potential benefits and opportunities of crypto-asset innovation. My Administration is eager to work with the Congress to ensure a comprehensive and balanced regulatory framework for digital assets, building on existing authorities, which will promote the responsible development of digital assets and payment innovation and help reinforce United States leadership in the global financial system.”

In a vote of 228 to 182, the Republican-led bill was approved by the House, with the support of 21 Democrats. The Senate also passed the bill with a vote of 60 to 38, with eleven Democrats in favor. President Biden's veto has brought Bitcoin and cryptocurrency into focus in both the political and regulatory arenas.

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