💪Senate Repeals SEC's SAB 121 Rule!
A massive win for Crypto and a Big Loss for Gary Gensler and Elizabeth Warren
GM Thinkers 💡
Yesterday was a historic day for Crypto! In a significant move, the U.S. Senate has voted to repeal the Securities and Exchange Commission’s Staff Accounting Bulletin No. 121 (SAB 121). This decision marks a major shift in the regulatory landscape, potentially impacting numerous businesses and financial practices across the country.
What is SAB 121?
SAB 121, introduced by the SEC, provided guidelines on accounting and disclosures for companies holding crypto assets. The bulletin aimed to standardize the way companies report these assets on their balance sheets, ensuring greater transparency and consistency in financial statements. However, the rule had been met with criticism from various industry stakeholders, who argued that it imposed excessive burdens and stifled innovation.
Why the Repeal?
The repeal of SAB 121 comes as part of a broader effort by lawmakers to reduce regulatory hurdles and support the growth of emerging technologies and industries, including the rapidly evolving crypto sector. Proponents of the repeal argue that the original rule was too restrictive and did not reflect the unique nature of digital assets. By removing these guidelines, they believe companies such as Banks will have more flexibility in how they manage and report their crypto holdings, potentially fostering greater innovation and investment in the sector.
It is important to note that the Government Accountability Office (GAO) concluded that SEC Staff Accounting Bulletin 121 (SAB 121) represents a “rule” for purposes of the Congressional Review Act (CRA). Under the CRA, rules from federal agencies are subject to a 60-day period during which Congress may disapprove the rule. SAB 121 was issued in March 2022 by staff in the Division of Corporation Finance and the Office of the Chief Accountant to address the accounting for obligations to safeguard crypto assets that an entity holds for platform users. According to the GAO decision, the SEC believed that the staff guidance did not qualify as a rule under the CRA.
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This week I attended the DC Blockchain Summit hosted by the Digital Chamber. At the summit I sat down with SEC Commissioner Hester Peirce for a quick conversation.
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Topics:
Repeal of SAB 121
Crypto's impact on Politics
Bitcoin Spot ETF
Would she take the SEC Chair job if it is offered to her
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