The U.S. Congress has passed its first standalone cryptocurrency legislation, aiming to overturn the SEC’s SAB 121 rules concerning crypto assets. Despite this, President Joe Biden has threatened a veto, citing worries about financial stability and market uncertainty.

**‘We Are Just Getting Started’**

In a historic step, the U.S. Congress approved its first standalone crypto bill last week, targeting the controversial SEC’s Staff Accounting Bulletin No. 121 (SAB 121). U.S. Senator Cynthia Lummis (R-WY) announced on social media platform X that the Senate's approval of a Congressional Review Act (CRA) to overturn SAB 121 is a major win for financial innovation and a clear criticism of the Biden administration and SEC Chair Gary Gensler’s treatment of crypto. She highlighted that this is the first time standalone crypto legislation has passed Congress and hinted at more efforts to come. The CRA allows Congress to review and potentially overturn regulations from federal agencies.

SAB 121 requires entities holding crypto assets for users to record these as liabilities and corresponding assets at fair value on their balance sheets. The bulletin has been criticized for potentially placing significant financial burdens on banks and financial institutions, possibly discouraging them from offering crypto asset custody services.

House Financial Services Committee Chair Patrick McHenry (R-NC) stated: “SAB 121 requires financial institutions and firms safeguarding their customers’ digital assets to hold those assets on their balance sheet, making it cost prohibitive to do so.” He emphasized that SAB 121 is a clear example of regulatory overreach under Gary Gensler’s SEC leadership.

The U.S. House of Representatives voted to overturn SAB 121 earlier this month, followed by the U.S. Senate’s vote to repeal the bulletin last week. However, President Joe Biden has threatened to veto the repeal, with a White House statement saying: “Limiting the SEC’s ability to maintain a comprehensive and effective financial regulatory framework for crypto assets would introduce substantial financial instability and market uncertainty.”

What do you think about the first standalone crypto legislation passed by the U.S. Congress and the controversy surrounding SAB 121? Share your thoughts in the comments section below.