US President Vetoed Bill Overturning SEC’s Controversial SAB 121 Rule
Washington, D.C. – US President Joe Biden vetoed H.J. Res. 109, which aimed to overturn the SEC’s controversial SAB 121 rule, on May 31.
Biden cited that SAB 121 represents the “considered technical” views of SEC staff and that the resolution would limit the agency’s ability to set guardrails and address future issues and risks. He emphasized the rule’s role in protecting the public, stating: “My Administration will not support measures that jeopardize the well-being of consumers and investors.”
The President announced that his administration will collaborate with Congress to develop a “comprehensive and balanced” crypto regulatory framework that builds on existing authority and supports innovation in the US.
Biden also highlighted a party divide in his veto statement by labeling H.J. Res. 109 as a “Republican-led resolution.” Despite claims of bipartisan support, voting records show dominant Republican backing for the bill with 48 of 60 yes votes in the Senate and 207 of 228 yes votes in the House of Representatives.
The SAB 121 rule requires financial institutions and firms that safeguard customer digital assets to consolidate the assets on their balance sheet and make specific disclosures. While some argue the rules are restrictive and bypassed standard procedures, others believe they are less restrictive than claimed and may need modifications.
Biden’s veto only addresses one legislative challenge to SAB 121, leaving the door open for future debates and potential changes to the rule.
