The US House of Representatives Overhauls Digital Asset Regulations
On May 8, Representative Mike Flood’s bipartisan resolution, H.J.Res. 109, passed in the US House of Representatives, aiming to overturn the SEC’s Staff Accounting Bulletin (SAB) 121, a controversial topic within the financial and crypto communities. This resolution is seen as a significant step in reshaping the regulation of digital assets.
Support for Legislative Change
- The rule under SAB 121, issued in March 2022, mandates financial institutions to include customers’ digital assets on their balance sheets, posing operational and financial challenges.
- H.J.Res. 109 supporters believe that overturning SAB 121 will eliminate barriers and foster safer digital asset transactions through regulated financial institutions.
Legislative Support vs. Presidential Veto
- House Majority Whip Tom Emmer emphasizes bipartisan support for digital asset innovation to flourish in the United States.
- The White House, under the Biden administration, has expressed opposition to overturning the SEC’s rule, citing risks to investors and financial stability.
Lawmakers Envision SEC’s Crypto Oversight
Criticism toward the SEC’s recent actions includes concerns about its handling of major crypto platforms, with some lawmakers perceiving regulatory overreach.
Lawmakers’ Critique of SEC’s Stance
- US Representative John Rose argues that the SEC’s actions exceed its role of maintaining orderly markets and protecting investors, proposing clarity in regulatory mandates.
- SEC Chairman Gary Gensler defends the agency’s strict regulatory approach to oversee the crypto sector amid growing concerns over scams and fraud.
SEC Commissioner’s Perspective
- SEC Commissioner Mark Uyeda advocates for a regulatory framework that supports innovation in the digital asset space and encourages compliance for legitimate efforts.
Implications for the Future
As H.J.Res. 109 progresses to the Senate, the potential impact of its approval on the regulatory landscape for digital assets remains a subject of intense debate, underscoring the delicate balance between regulation and innovation in the crypto industry.
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