US President Joe Biden vetoed a congressional resolution aimed at rescinding guidance from the US Securities and Exchange Commission (SEC), which was criticized for preventing the cryptocurrency industry from cooperating with banks. This decision was made despite long-standing complaints from both the crypto industry and banking institutions.
Rejection of cryptocurrency rule
Personnel Accounting Bulletin No. The guidance, referred to as 121, has received various reactions since its publication in 2022. Banks argued that this bulletin imposed prohibitive costs and prevented them from scaling digital asset holding services for their customers. The crypto industry, on the other hand, argued that the guideline restricts innovation and growth in the sector.
The congressional resolution, which garnered bipartisan support in the Senate with 11 Democrats voting in favor, sought to invalidate the SEC release. This decision, passed by the House of Representatives with a vote of 228-182, aimed to facilitate the integration of the cryptocurrency sector and the traditional banking system. Proponents of the decision argued that the guidance restricts options for Americans who want to store digital assets in traditional banks.
Biden’s veto reason
In his veto message released Friday evening, President Biden emphasized his administration’s commitment to consumer and investor protection. “My administration will not support measures that jeopardize the well-being of consumers and investors,” Biden said and added:
To capitalize on the potential benefits and opportunities of crypto asset innovation, appropriate security measures that protect consumers and investors are necessary.
Biden also expressed willingness to cooperate with Congress on creating a comprehensive regulatory framework for crypto assets. “I am eager to work with Congress to ensure a comprehensive and balanced regulatory framework for crypto assets,” he added. This statement revealed that the President showed flexibility regarding the regulatory framework on the issue.
White House stance
Earlier this month, the White House said it opposed a bill passed by the House of Representatives that would create a regulatory framework for digital assets, citing inadequate consumer and investor protections. However, by refraining from threatening a full veto, the administration had indicated that the President was open to negotiating legislation on this issue. The cryptocurrency industry needs clearer and supportive regulations to ensure its integration with traditional financial systems. In this process, Biden’s veto decision shows that the regulatory obstacles faced by the industry continue.
These developments had a great impact in the cryptocurrency world. While both investors and cryptocurrency companies are following Biden’s decision closely, they are wondering how future regulations will affect the industry. The path that the USA will take in cryptocurrency regulations seems to constitute an important reference point on a global scale.
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