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After a period of intense scrutiny of the cryptocurrency industry, many speculated that the Biden administration had reversed its stance by allowing the U.S. Securities and Exchange Commission (SEC) to approve several spot ethereum exchange-traded funds (ETFs). However, President Joe Biden has vetoed the latest resolution intended to quash the SEC’s crypto asset rules in SAB 121. Biden’s veto has generated significant animosity within the crypto community, leading to a widespread belief that Biden has lost the support of the entire crypto industry.
Did Biden’s Veto of SAB 121 Seal His Political Fate in 2024?
Two days ago, President Joe Biden vetoed the legislation designed to overturn the SEC’s SAB 121. SAB 121, a contentious accounting guidance issued by the SEC, mandates that financial institutions and firms safeguarding customer digital assets consolidate those assets on their balance sheets and provide specific disclosures. These stringent accounting requirements make it prohibitively costly and impractical for banks to offer large-scale crypto custody services.
Regarding the veto, Biden stated his administration would collaborate with Congress on a “comprehensive and balanced” crypto regulatory framework but vetoed this particular resolution to uphold the SEC’s accounting authority. The crypto community reacted negatively to this decision. Skybridge Capital’s Anthony Scaramucci commented that Biden’s stance on crypto could have unforeseen consequences. “[Biden’s] position on crypto may cost him more than he realizes,” Scaramucci wrote on X. “It was a really bad decision to veto that bill. Especially at this critical time.”
Galaxy Digital’s Mike Novogratz weighed in on Biden’s decision. “This is disappointing and maybe predictable,” Novogratz said. “Snatching defeat from the jaws of victory. The [Democrats] were trying to defuse Trump being the crypto president and were doing a great job. But this doesn’t help at all. Whoever is advising Biden needs to have his head examined,” the Galaxy founder added. Perianne Boring, the founder and CEO of the Chamber of Digital Commerce stated:
Biden’s veto of the SEC’s illegal crypto custody regs is not the end of this fight. Congress can override the veto. Together, we will defend our freedom of speech, digital property rights, and our right to assemble. Come November, we will cast out the anti-crypto army once and for all.
Ryan Sean Adams, the founder of Bankless, also remarked that this decision will impact Democrats in the upcoming general election. “Biden just Vetoed the only pro-crypto bill to ever come across his desk,” Adams remarked on X. “This was a layup. SAB 121 is an anti-crypto rule put in place by Gensler’s SEC to stop banks from holding crypto.” The Bankless executive added:
Crypto hates it. The banks hate it. All he had to do was not veto the repeal. This will cost Democrats in November.
Out of the 335.89 million U.S. residents, it is estimated that 50 million eligible voters are crypto advocates. With Democrats like Elizabeth Warren and Joe Biden throwing shade at the crypto industry, and Donald Trump endorsing it and pledging to protect crypto supporters, the President’s decision appears unfavorable from the spectators’ viewpoint. The President’s recent veto might have been the straw that broke the camel’s back.
“Veto of SAB 121 by Biden shows that there is no real effort in the democratic party to work with crypto,” crypto enthusiast Eric.eth wrote on X. “The ETH ETF was approved because the SEC had no grounds to reject it, period. The Democrats’ war of crypto is more full force than it ever has been before.”
What do you think about the crypto community reacting to Biden’s veto? Share your thoughts and opinions about this subject in the comments section below.