America’s banking lobby’s last-minute bid to stop Biden’s SAB 121 reversal
Hours before US President Joe Biden vetoed Staff Accounting Bulletin 121 on May 31, the US banking industry's largest lobbying organization – the American Bankers Association (ABA) – wrote a letter to challenge the decision. .
“Preventing regulated banking firms from effectively providing digital asset protection services harms investors, customers and ultimately the financial system,” the ABA wrote in a May 31 letter to Biden, before announcing its decision to oppose the congressional resolution. Repeal of US Securities and Exchange Commission (SEC) SAB 121 Guidelines.
Although both houses of Congress, the House of Representatives and the Senate voted to repeal the SAB 121 directive, Biden chose to use the president's veto power to prevent the directive from being overturned.
The lobby group explained that SAB 121 is a major change in how custodial assets are typically handled, and will make it harder for the industry to keep digital assets safe for customers.
Those in the crypto industry may find the ABA's pro-crypto statement surprising.
“SAB 121 represents a significant departure from long-term accounting for assets under protection and threatens the industry's ability to maintain safe and sound digital assets for its customers,” the ABA said.
“Limiting banks' ability to provide these services leaves trusted customers with fewer options for protecting their digital asset portfolios and ultimately exposes them to additional risk.
RELATED: Sen. Lummis sends letter to Biden saying no veto for SAB 121 repeal
The ABA's pro-crypto statement may come as a surprise to those in the crypto industry, especially since reports emerged last year that the group is helping Senator Elizabeth Warren, who is known for helping draft anti-crypto legislation.
In December 2023, Cointelegraph reported that in a video posted on X (formerly Twitter), Roger Marshall admitted that he and Elizabeth Warren had approached the ABA for help in drafting the Digital Asset Anti-Money Laundering Act.
“The first thing we did was go to the American Bankers Association and say, ‘Help us make this work,'” Marshall said.
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