House lawmakers voted on a resolution Wednesday to overturn the SEC's crypto accounting policy, Staff Accounting Bulletin No. 121. Biden stated that he would veto the resolution if it were to reach his desk for approval.
Twenty-one Democrats voted in favor of the resolution. The industry claims the cryptocurrency accounting guidance has deterred banks from handling crypto customers.
The SEC's Staff Accounting Bulletin No. 121, also referred to as SAB 121, aimed to provide clarification on the accounting treatment for crypto assets, advising that a bank holding customer's digital tokens should be recorded on its own balance sheet, which could result in significant capital expenses.
The bulletin has faced criticism from digital asset businesses and Republican lawmakers since its inception.
According to a statement from Biden, the policy is worth defending with a veto.
“SAB 121 was issued in response to demonstrated technological, legal, and regulatory risks that have caused substantial losses to consumers,” Biden said. He claims to “strongly oppose” disrupting the SEC's work.
Originally introduced as staff guidance, SAB 121 underwent a subsequent Government Accountability Office (GAO) review, which concluded that the agency should have treated it as a rule. This would have entailed allowing for full public comments and submission to Congress.
The resolution will now proceed to the Senate, where there seems to be considerable support from Republicans.
