US President Joe Biden’s administration has taken a stance against a joint resolution affecting crypto policy at the Securities and Exchange Commission (SEC), signaling plans for a possible veto if the resolution passes the SEC’s agency president reaches.

In fact, the White House issued a statement on May 8 expressing its strong opposition to members of the House of Representatives attempting to pass HJRes. 109, a joint resolution aimed at reversing the SEC’s Staff Accounting Bulletin (SAB) No. 121. This bulletin requires banks to keep customers’ digital assets on their balance sheets with capital reserves.

The Biden administration emphasized the importance of SAB 121 in addressing technological, legal and regulatory risks that pose significant losses to consumers. The invocation of the Congressional Review Act via HJRes. 109 could potentially limit the SEC’s ability to effectively regulate crypto assets, leading to financial instability and market uncertainty.

The resolution has sparked debate among Democratic and Republican leaders on the House Financial Services Committee. Representative Patrick Henry advocated for the resolution, emphasizing the need for banks to safeguard Americans’ digital assets.

Rep. Maxine Waters, on the other hand, opposed the resolution, highlighting the transparency that SAB 121 brings to the digital asset space and its role in preventing fraud and abuse. After a vote in favor of HJRes. 109, Representative McHenry called for a count of the votes in favor and against, which led to a postponement of consideration of the resolution. If the resolution moves forward and reaches President Biden’s desk, his administration has indicated it plans to veto it.

The SEC has been criticized for its tough stance on cryptocurrencies, and members of the digital assets industry have asked the Biden administration for clear regulatory policies multiple times in the past. However, the regulator continues to strongly believe that all digital assets and related offerings are securities, and has filed lawsuits against crypto companies.

Recently, the SEC sent a Wells Notice to Robinhood, alleging that the platform has been selling unregistered securities through its crypto division. The company claims to be disappointed in the regulator’s actions, adding that it was involved in discussions with SEC staff over the registration of its activities.

On the other hand, SEC Chairman Gary Gensler expressed frustration with the overwhelming focus on cryptocurrency during media interviews, stating that the crypto market makes up a small part of the overall financial landscape.


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