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Reps. Wiley Nickel And Mike Flood’s Resolution To Be Voted On Today
The U.S. House of Representatives is set to vote this afternoon on a resolution proposed by Representatives Wiley Nickel (D-NC) and Mike Flood (R-NE) that would see a formal disapproval of the United States Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin (SAB) 121.
Background of SAB 121
SAB 121, introduced in April 2022, has sparked controversy as it mandates banks to list liabilities and corresponding digital assets on their balance sheets, aiming to protect crypto assets.
Concerns and Criticisms
There have been concerns raised regarding the ethicality of SAB 121, especially due to the lack of a Congressional report supporting the accounting bulletin. Representative Flood criticized the SEC for bypassing the rulemaking process and imposing non-binding guidance.
- The Impact on Banking Institutions
- Industry Response
- Regulatory Criticism
Banking institutions have criticized SAB 121 for hindering their ability to provide custodial services for digital assets, including SEC-approved spot Bitcoin ETFs.
The Securities Industry and Financial Markets Association president highlighted the deviation from traditional asset accounting treatment and its impact on bank capital and liquidity ratios.
Under Chairman Gensler’s leadership, the SEC has faced criticism for its strict regulatory stance on cryptocurrencies, leading to legal action against digital asset firms.
Future Outlook
Senator Cynthia Lummis is spearheading a joint senate resolution in support of Flood’s proposal, indicating ongoing debates in both chambers regarding the fate of SAB 121.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
