-
The
groups
that
lobby
for
big-bank
interests
in
Washington
asked
the
White
House
to
step
back
from
its
stated
intention
to
kill
Congress’
effort
to
cancel
a
controversial
Securities
and
Exchange
Commission
crypto
policy. -
Two
of
the
digital
assets
sector’s
biggest
allies
on
Capitol
Hill
also
sent
a
similar
request
to
the
president.
In
a
rare
lobbying
overlap
with
crypto
world,
Wall
Street
banks
and
members
of
Congress
are
asking
President
Joe
Biden
to
reverse
course
on
his
vow
to
veto
the
U.S.
congressional
resolution
to
overturn
the
U.S.
Securities
and
Exchange
Commission’s
(SEC)
crypto
accounting
policy.
In
recent
bipartisan
votes
that
saw
many
members
of
Biden’s
party
rebuff
his
opposition,
Congress
decided
to
reject
SEC’s
Staff
Accounting
Bulletin
No.
121
(SAB
121)
–
a
controversial
accounting
standard
that
would
require
banks
to
treat
customers’
digital
assets
differently
than
other
assets,
demanding
they
be
kept
on
a
bank’s
balance
sheet.
Crypto
companies
have
argued
this
threatens
their
ability
to
do
business
with
banks,
and
the
bankers
agree.
“SAB
121
effectively
precludes
regulated
banking
organizations
from
offering
digital
asset
custody
at
scale
since
it
treats
the
assets
as
if
they
are
owned
rather
than
simply
custodied
by
a
banking
organization,”
according
to
a
letter
to
Biden
on
Friday,
signed
by
several
groups
including
the
American
Bankers
Association
and
Financial
Services
Forum.
“Institutions
that
are
forced
to
record
custodied
digital
assets
on
balance
sheet
are
subjected
to
higher
capital,
liquidity,
and
other
prudential
requirements,
unlike
their
non-bank
competitors.”
The
letter
came
the
same
day
Sen.
Cynthia
Lummis
(R-Wyo.)
and
Rep.
Patrick
McHenry
(R-N.C.)
published
their
own
letter
to
Biden,
dated
May
30,
similarly
asking
him
to
not
veto,
or
at
least
“work
with
the
SEC
to
rescind
the
staff
guidance.”
“Rescinding
SAB
121
is
well
within
the
SEC’s
authority
and
there
is
ample
precedent
for
revisiting
a
staff
accounting
bulletin,”
the
letter
said.
“In
fact,
most
staff
accounting
bulletins
over
the
last
three
decades
have
been
revisions
and
rescissions
of
prior
guidance.”
Seven
other
representatives
signed
onto
the
letter,
including
Reps.
Mike
Flood
(R-Neb.)
and
Wiley
Nickel
(D-N.C.),
the
sponsors
of
the
resolution.
Biden’s
threat
to
veto
the
resolution
noted
that
erasing
the
rule
under
the
Congressional
Review
Act
would
mean
nothing
similar
can
be
implemented
by
the
SEC
in
the
future,
which
would
“inappropriately
constrain
the
SEC’s
ability
to
ensure
appropriate
guardrails
and
address
future
issues
related
to
crypto-assets
including
financial
stability.”
The
group
of
11
Senate
Democrats
who
went
against
the
president
included
Majority
Leader
Chuck
Schumer
(D-N.Y.)
and
Sen.
Ron
Wyden
(D-Ore.),
the
chairman
of
the
Senate
Finance
Committee,
who
said
at
CoinDesk’s
Consensus
2024
on
Friday
that
the
SEC’s
policy
“basically
sets
up
a
different
standard
for
crypto
than
everybody
else
has
in
the
financial
sector.”
Last
week,
SEC
Chair
Gary
Gensler
sought
to
explain
SAB
121
as
an
attempt
for
the
regulator
to
respond
to
the
turmoil
and
investor
harms
happening
in
crypto
during
2022.
He
argued
it
was
“just”
a
staff
bulletin
meant
to
address
the
fact
that
the
failures
of
collapsing
crypto
firms
were
treating
customer
assets
as
part
of
their
bankruptcy
estates.
Biden
has
until
Monday
to
make
a
final
decision
on
whether
to
veto
the
resolution
or
not.
