The U.S. House of Representatives voted 228-182 to pass a landmark resolution that could affect the way banks store cryptocurrencies, making waves in the Bitcoin and altcoin industry and financial regulations. In this news, we will examine in detail the Parliamentary Joint Decision No. 109 and its potential effects.
Outline of the decision
The decision aims to rescind Accounting Bulletin Statement (SAB) 121, which the Securities and Exchange Commission (SEC) issued in 2022. This bulletin requires banks to keep customers’ cryptocurrency assets on their balance sheets and maintain an offset obligation. Proponents of the decision argue that this rule is too strict for banks and hinders innovation and participation in the Bitcoin and altcoin industry. “This rule makes it impossible for banks to hold their customers’ crypto assets,” said Rep. Patrick McHenry (R-NC).
Democrats oppose cryptocurrency decision
Democrats opposed the decision and argued that the SEC needed the rule to regulate the Bitcoin and altcoin market. “Repealing this rule would make it harder to protect investors against fraud and maintain market stability,” said Rep. Maxine Waters (D-CA).
Possible effects of the decision:
- For banks: The decision could significantly change the way banks store BTC and altcoins. Instead of keeping cryptocurrencies on their balance sheets, banks may choose to turn to third-party custodians or stablecoins.
- For the Cryptocurrency Industry: The decision is expected to encourage innovation and participation in the cryptocurrency industry. Banks being more flexible in storing Bitcoin and altcoins could attract more institutional investors to the sector.
- For investors: There are concerns that the decision could make investors more vulnerable to fraud. The fact that banks are less responsible for storing cryptocurrencies may increase the risk of fraud.
- For markets: It is also thought that the decision may cause instability in the market. Bitcoin and altcoin prices are likely to become more volatile and there will be more uncertainty in the market.
The resolution is not expected to pass the Senate. The White House also opposed the decision and said President Joe Biden would veto it. In conclusion, the decision of the US House of Representatives proposing changes to cryptocurrency custody rules is a significant development in the Bitcoin and altcoin industry and financial regulations. The final impact of the decision will become clear after the Senate’s vote and the White House’s veto threat.
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