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The U.S. Senate has decisively overturned a rule by the Securities and Exchange Commission (SEC) that restricted financial institutions from engaging in cryptocurrency-related activities. This rule had mandated that banks reflect customers’ digital assets on their balance sheets, backed by corresponding capital — a policy criticized for stifling innovation. Senate Votes Overwhelmingly Against SEC’s Rule In a major decision on May 16, the Senate voted 60 to 38 to pass H.J.Res. 109, a resolution that nullifies the SEC’s Staff Accounting Bulletin No. 121. This decision reflects a strong disapproval across party lines and highlights a broader legislative push against overregulation. Related: RIPPLE SEEKS TO SHIELD DOCUMENTS AMID SEC BATTLE The Blockchain Association hailed this as a momentous stance against what is seen as an impediment to financial innovation. 1/ Today, the Senate voted, in overwhelmingly bipartisan fashion, to #repealSAB121, an anti-innovation accounting bulletin which was improperly issued by the SEC in 2022. — Blockchain Association (@BlockchainAssn) May 16, 2024 The relationship between the crypto market and the SEC has been fraught with tension, characterized by persistent legal battles and a regulatory approach that the industry perceives as overly aggressive. This latest legislative action is a critical change, with the Senate taking a clear position against one of the SEC’s most controversial regulations. Bipartisan Support Faced Presidential Veto Threat The resolution received bipartisan support in the Senate, which is currently under a narrow Democratic majority. However, the backdrop to this legislative victory includes President Joe Biden’s warning of a potential veto. On May 8, prior to the resolution’s passage in the House, President Biden expressed concerns about protecting investors and the broader financial system. His veto could send the bill back to Congress, where it would need a two-thirds majority to override his decision. Also Read: U.S. HOUSE TO VOTE ON…

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Filed under: News - @ May 16, 2024 10:14 pm