ABA’s Appeal to President Biden

The ABA said in a May 31 letter to Biden, just before he said he would veto the Congressional resolution aimed at eradicating the U.S. Securities and Exchange Commission (SEC) SAB 121 guidelines, “Precluding regulated banking organizations from effectively providing digital asset safeguarding services at scale harms investors, customers, and ultimately the financial system.”

Biden chose to utilize his presidential veto authority, therefore preventing the SAB 121 guideline from being reversed, even though both houses of Congress—the House of Representatives and the Senate—voted in support of repeal.

The advocacy organization clarified that SAB 121 is a significant departure from the general treatment of custodial assets and might make it more difficult for the sector to maintain digital assets safe for consumers.

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People in the crypto space might find the ABA’s pro-crypto stance unexpected. The ABA clarified, “The SAB 121 represents a significant departure from longstanding accounting treatment for custodial assets and threatens the industry’s ability to provide its customers with safe and sound custody of digital assets.”

“Limiting banks’ ability to offer these services leaves customers with few well-regulated, trusted options for safeguarding their digital asset portfolios and finally exposes them to increased risk,” it said.

For some in the crypto space, the ABA’s pro-crypto message may be shocking, particularly given that only last year claims of the association supporting Senator Elizabeth Warren, renowned for her mistrust of crypto, in writing anti-crypto legislation surfaced.

Roger Marshall stated in December 2023, on a video that leaked on X (previously Twitter), that he and Elizabeth Warren visited the ABA for help in writing the Digital Asset Anti-Money Laundering Act.

“The first thing we did was go to the American Bankers Association and say, ‘Help us craft this,'” Marshall said.

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