Tech
SEC Custody Rule Turns Cryptocurrencies Into Political Football, Says Rep. Nickel
The congressman representing Carolina, Representative Wiley Nickel, has opposed the US Securities and Exchange Commission (SEC) cryptocurrency custody rule. Notably, the Senate has yet to pass its votes on the proposed cryptocurrency custody rule.
In a letter addressed to SEC Chairman Gary Gensler, Rep. Nickel, noted that the agency has turned cryptocurrency regulation into a “political football.” The congressman said the regulator’s open hostility to the rule is unfavorable to President Joe Biden’s administration.
Congressman Urges Retirement of SEC Cryptocurrency Custody Regulation
In his May 15 letter, Congressman Nickel called asked the SEC to withdraw Staff Accounting Bulletin 121 (SAB121). Rep. Nickel pointed out that the SEC’s custody rule conflicts with its mission to protect U.S. investors.
Today I sent a letter to @SECGovern President Gary Gensler calls on the agency to withdraw Bulletin 121 on personnel accounting. Unfortunately, the SEC is turning around #crypto in a political and forcing football @POTUS needlessly choosing a side on an issue that matters to many Americans. pic.twitter.com/F3L8fZSNR0
— Representative Wiley Nickel (@RepWileyNickel) May 15, 2024
Furthermore, he highlighted the “open hostility” the rule creates against cryptocurrencies in the country. The rule prohibits US banks from engaging in digital asset custody services.
According to the Nickel representative, such a limitation could push investors to look for less regulated options outside the country, which poses greater risks to clients’ funds and assets in digital assets.
Additionally, Nickel noted that the SEC’s custody rules and activities are interfering with President Biden’s administration. Furthermore, she argued that the agency’s hostility towards cryptocurrencies is not in the President’s interest as it forces him to choose sides on crucial issues such as the regulation of digital assets.
The SEC’s custody rule must pass a Senate vote before promulgation
The Senate will meet May 16 to vote on SAB 121 for the resolution. Nickel urges the SEC chairman to withdraw the rule, but believes it will not come up for a vote.
Nickel mentioned:
“I hope this bipartisan bicameral resolution sends a message: It’s time to correct the SEC’s misguided approach to digital assets.”
Last week, the House of Representatives voted to repeal BRS 121. With its votes it passed a bill, HJRis 109overturning the SEC’s controversial cryptocurrency custody rule.
Other members of Congress, besides Rep. Nickel, oppose SAB 121. Second Representative Tom Emmerthe custody rule would reduce fairness, efficiency, and order in the U.S. financial market.
If the Senate passes the bill, it will go to the President for approval. Previously, President Biden revealed that he would veto the new SAB 121 if it reached his desk.
Also, on May 8, the White House released a statement regarding the passage of HJ Res. 109. He has indicated his strong opposition to members of the House of Representatives seeking to repeal BRS 121.
Additionally, the presidency indicated that a reversal would sabotage the SEC’s efforts to protect investors in digital asset markets. Furthermore, he acknowledged that the regulator’s rule is a welcome boost in safeguarding the broader financial system.
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