United States President Joe Biden has vetoed a resolution aiming to repeal the U.S. Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin (SAB) No. 121. This decision has sparked immediate backlash from the cryptocurrency industry and lawmakers.
“We’re disappointed that the administration chose to overrule bipartisan majorities in both Houses of Congress who recognized the harm created by SAB 121,” the Blockchain Association stated on social media. They argued that the decision undermines the SEC’s broader authority over accounting practices.
In his official response, Biden emphasized that challenging the guidelines would compromise the SEC’s regulatory power. “This reversal of the considered judgment of SEC staff risks undercutting the SEC’s broader authorities regarding accounting practices,” Biden wrote in his May 31 letter.
The controversial guidelines require institutions that custody crypto assets to record these holdings as liabilities on their balance sheets. Biden argued that repealing these guidelines would jeopardize the well-being of consumers and investors. “My Administration will not support measures that jeopardize the well-being of consumers and investors,” he added.
The guidelines were initially set to take effect on April 11 but faced considerable opposition from the crypto community and lawmakers. The House of Representatives voted 228 to 182 to repeal the SEC’s guidance, and the Senate followed with a 60-38 vote.
The wider crypto community expressed their frustration on social media, arguing that the decision stifles innovation. “This is a slap in the face to innovation and financial freedom,” stated Digital Chamber’s chief policy officer, Cody Carbone. Ripple CEO Brad Garlinghouse echoed these sentiments, calling the decision “incredibly disappointing.”
Biden’s veto of the resolution to repeal SAB 121 has sparked controversy and frustration, highlighting the ongoing tension between regulatory oversight and the rapidly evolving cryptocurrency industry.