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A majority in the United States Senate has approved a joint resolution urging the Securities and Exchange Commission (SEC) to revoke a rule impacting financial institutions engaged with crypto firms.
With a vote of 60 to 38 on May 16, U.S. Senators passed H.J.Res. 109, a resolution nullifying the SEC’s Staff Accounting Bulletin No. 121. This SEC rule mandates that banks hold customers’ digital assets on their balance sheets, with capital reserves maintained against them — a measure widely criticized by lawmakers and industry leaders for stifling innovation.
The crypto advocacy group Blockchain Association hailed the Senate’s vote, describing the 60 ‘Yeas’ as a strong bipartisan signal against the rule.
Before passing the U.S. House of Representatives on May 8, President Joe Biden announced his intention to veto the bill to “safeguard investors in crypto-asset markets and the broader financial system.” If vetoed, the legislation would return to Congress, requiring a two-thirds majority vote to pass again.
“The threat of a presidential veto ignores the growing awareness among the electorate, particularly younger demographics, about the importance of crypto in policymaking,” remarked the Blockchain Association.
This vote marks an uncommon bipartisan action by the U.S. Senate, with a 51-49 split in favor of Democrats. Senator Cynthia Lummis highlighted it as the first standalone crypto legislation passed this session of Congress. The White House has not yet issued a statement regarding the resolution’s approval.
Representative Mike Flood, the resolution’s sponsor, urged President Biden to reconsider his intent to veto, emphasizing the widespread opposition to SAB 121.
The joint resolution could foreshadow the fate of another crypto bill, the Financial Innovation and Technology for the 21st Century Act. This legislation outlines the roles of the SEC and Commodity Futures Trading Commission in regulating digital assets. Introduced in July 2023, it is slated for a House floor vote in May.
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