U.S. Senator Cynthia Lummis recently showcased her support for cryptocurrency laws by posting "Bitcoin laser eyes" on X.

This action follows the Senate's passing of H.J.Res. 109, aiming to overturn the SEC's Staff Accounting Bulletin (SAB) No. 121.

Senator Lummis Advocates for Bitcoin Legislation

Senator Cynthia Lummis of Wyoming, a strong Bitcoin advocate, sees the asset as a stable store of value and inflation hedge. As a member of the Senate Banking Committee, she seeks to create a regulatory environment that promotes crypto innovation while protecting consumers.

The Senate passed legislation to dismantle SAB 121, which restricts financial institutions from acting as custodians for digital assets like Bitcoin. H.J.Res. 109, under the Congressional Review Act, aims to remove these barriers, enabling regulated financial firms to offer cryptocurrency custody services.

Before the legislation's passage, Lummis criticized SAB 121 as an accounting rule imposed by SEC staff without full commission approval.

Recently, Lummis and Senator Ron Wyden expressed concerns to U.S. Attorney General Merrick Garland about the Department of Justice's interpretation of "money transmission" regulations. They argued that this interpretation deviates from FinCEN's definition and could criminalize essential crypto network operations, hindering responsible financial innovation in the U.S.

White House Cites Investor Protection Concerns

The White House opposes the legislation, with President Biden indicating he would veto the bill if it reached his desk, arguing that overturning SAB 121 could weaken the SEC's efforts to protect crypto-asset investors and the broader financial system.

Critics of SAB 121 argue that it is overly restrictive and prevents financial institutions from meeting the growing demand for Bitcoin services. They believe these institutions are well-equipped to handle the risks associated with digital asset custody due to their compliance frameworks and security measures.

Despite Senate approval, H.J.Res. 109's future is uncertain due to the potential presidential veto. If Biden vetoes the bill, it would maintain the current restrictions on financial institutions' digital asset custody. If he takes no action, the bill would become law without his signature.