Senate Votes to Rescind SEC Anti-Crypto Policy Targeting Banks, Biden Plots to Veto

Senate Votes to Rescind SEC Anti-Crypto Policy Targeting Banks, Biden Plots to Veto 

The US Senate supported repealing the anti-crypto banking rule by the Securities and Exchange Commission (SEC), with a dozen Democrats passing the resolution. 

The vote executed by the US Senate on Thursday, May 16, saw the legislators support the repeal of SEC’s policy Staff Accounting Bulletin (SAB) 121. The vote saw Democrats join Republicans in voting for the resolution President Joe Biden indicated would likely veto. 

Democrats Unite with Republicans to Kill SEC Anti-Crypto Policy

The Republican lawmakers led the charge in an attempt to rescind the policy that discourages regulated financial institutions from custodying cryptocurrencies. The Thursday session saw 12 Democrats team up with the Republicans for a final 60 against 38 votes to repeal the anti-crypto banking rule. The vote saw several Democrats break from the hardline party line to support the resolution, including Jon Tester, Bob Casey, Cory Booker, and Jacky Rose.

The Senate vote replicated the House of Representatives’ support for the resolution in the last week, where 228 were in support and opposed by 182. Nonetheless, the Biden Administration revealed that the President would veto the resolution.

The pronouncement by President Biden to oppose the resolution drew criticism from the US Presidential candidate Donald Trump, who urged the support of crypto. Trump lamented the exit of crypto companies from the US due to the restrictive policy when he attended the Trump NFT holders event in his Florida resort. 

Trump addressed the audience, assuring them that he would restore the US’s attractiveness to crypto companies once they were elected in the upcoming election. He indirectly responded to the hostility towards crypto, compelling crypto firms, talents, and innovations to exit. 

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Bipartisan Support in Senate to Rescind SAB 121

The resolution’s opponents to rescind the anti-crypto banking rule hail SAB 121 as safeguarding investors in the crypto asset markets and the broader financial system. It mandates financial institutions such as banks to capture crypto and their custody as liabilities within their balance sheets. 

Several lawmakers claimed the proposed bill would scare the banks. They warned that it would be costly to comply with SAB 121 and thus not beneficial for the clients and investors. 

At the onset of 2024, a bipartisan team of lawmakers warned that the SAB 121 would fail. Senator Cynthia Lummis from Wyoming teamed with Representatives Mike Flood and Wiley Nickel to table a joint resolution toward repealing the SAB 121 policy. 

The stance by the Biden administration threatening to veto the non-binding resolution that the House of Representatives voted in support prompted criticism from the crypto community. Cardano creator Charles Hoskinson termed the Biden administration as one deploying a coordinated effort to strangle crypto. Hoskinson decried that Biden had vowed to veto the resolution H.J. Res. 109 that demands the SEC rescind the staff bulletin on crypto asset custody. 

President Biden to Veto Solution to Anti-Crypto Policy

The vote by Senators to extinguish the anti-crypto policy arose from the Republicans who condemned the hardline stance of the US regulators. The Republicans claimed the SEC appeared too burdensome by cracking down on the crypto asset industry. 

The vote supporting the resolution illustrates that the issue garnered bipartisan support, understanding, and conviction to kill the anti-crypto policy.

The Satoshi Action Fund chief executive Dennis Porter observed that several legislators drawn from Republicans and Democrats were embracing openness to crypto. The nonprofit organization’s boss added that legislators acknowledge and support protecting American citizens’ rights to hold and utilize crypto assets. 

The legislators questioned the Biden Administration’s anti-crypto stance.  Porter hailed the unity portrayed by Democrats and Republicans to rescind the SAB 121. 

Porter celebrated the vote for supporting his idea that Bitcoin and crypto assets are nonpartisan. He added that Democrats joined the progressives and liberals in supporting the resolution, thus illustrating the capability to understand the tech power. 

Porter is optimistic that bipartisan support edges closer to guaranteeing financial inclusion and banking solutions for the unbanked population. He added that it would be rejuvenating if President Biden identified with the supermajority of 60 senators to repeal the SAB 121.  

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