In an important development for the cryptocurrency industry, the House of Representatives of the United States of America is gearing up to vote on President Joe Biden’s decision to veto Staff Accounting Bulletin 121 (SAB 121). This legislation, also known as Senate Bill 121, has sparked intense debate within the industry due to concerns about its potential impact on banks’ ability to safeguard digital assets effectively.
Understanding Senate Bill 121
Under the proposed rule SAB 121, entities required to report to the SEC and hold cryptocurrency would need to include these holdings on their balance sheets. This would mean that businesses custodying cryptocurrency would have to record their customers’ cryptocurrency holdings as liabilities on their balance sheets. Critics argue that this could hinder American banks’ ability to manage cryptocurrency exchange-traded products on a large scale, posing a concentration risk.
The Voting Process
The House of Representatives is expected to conduct a crucial vote on Senate Bill 121 in the upcoming week. To override President Biden’s veto, a two-thirds majority vote is needed from both the House and the Senate. Previously, the House approved the measure with a vote of 228-182, receiving support from Republicans and some Democrats. The Senate also approved it with a vote of sixty to thirty-eight, including support from Senate Majority Leader Chuck Schumer.
Importance of Additional Support
To successfully override the veto, the House would need 290 favorable votes, requiring additional support from Democrats. This bipartisan effort is crucial for achieving the two-thirds majority needed. Alexander Grieve from Paradigm believes that while challenging, obtaining a two-thirds vote is not impossible.
Conclusion
The upcoming vote in the US House of Representatives on SAB 121 holds significant importance for the crypto sector. The outcome will determine whether the regulation mandating SEC-reporting firms to disclose bitcoin holdings on their balance sheets will be upheld or reversed. With a two-thirds majority vote required, the support of additional Democrats will be pivotal in shaping the fate of Senate Bill 121.
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