Members of Congress criticized the SEC and its chair, Gary Gensler, for taking strong regulatory measures against the banking industry’s holding of cryptocurrency assets.
Lawmakers have sought to soften the unfavorable norms established against the crypto business, and the regulatory activities of the Securities and Exchange Commission (SEC) under Chair Gary Gensler’s leadership have been under investigation on many occasions.
Currently, three US congressmen are attempting to get the commission’s prohibition on financial institutions’ holding of cryptocurrency assets nullified.
Representatives Mike Flood and Wiley Nickel of the United States House of Representatives and Senator Cynthia Lummis of the United States Senate presented a Bipartisan Resolution to repeal Staff Accounting Bulletin (SAB) 121 of the United States Securities and Exchange Commission on February 1, 2019.
Lawmakers argued that banks cannot provide crypto custodian services to those who invest in digital assets since the Staff Accounting Bulletin requires them to record the managed assets as assets on their balance sheet.
Lawmakers brought attention to what they saw as the SEC’s standards’ regulatory overreach by stressing that SAB 121 is more of a regulation than an accounting bulletin.
“Congressman Wiley Nickel stressed that the SEC and Gary Gensler are continuing to overstep their authority with Staff Accounting Bulletin No. 121.”
Industry organizations, including the Bank Policy Institute and the American Bankers Association, have urged for the revocation of the draft resolution to keep assets held by banks off-balance sheet.
A number of lawmakers, including Wiley Nickel and Mike Flood, have criticized the SEC chair for the industry-harming restrictions he has imposed.
Reps. Tim Burchett and Steve Womack said in November 2023 that the SEC’s enforcement operations were a financial burden on the country. The MPs suggested a drastic reduction in Chair Gensler’s compensation to $1 per year, highlighting the commission’s excessive power and harsh regulatory stance.
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