The American Bankers Association today said it supports a proposed House joint resolution expressing congressional disapproval of a Securities and Exchange Commission policy on safeguarding cryptoassets. The policy—outlined in Staff Accounting Bulletin 121—requires SEC registrants to record an obligation to safeguard the cryptoassets that they hold at the fair value of the related assets. H.J. Res. 109 would overturn the policy if adopted by both houses of Congress and signed by the president.
In comments to the House Financial Services Committee, ABA said the SEC policy is a departure from the banking industry’s longtime practice of treating custody assets off-balance sheet and effectively precludes banks from offering digital asset custody at scale. “Limiting banks’ ability to offer these services leaves consumers with few well-regulated, trusted options for their digital asset portfolios and ultimately exposes them to risk,” the association said.
During a markup hearing, the committee voted to advance the resolution to the House. In his opening statement, H.J. Res. 109 sponsor Rep. Mike Flood (R-Neb.) submitted ABA’s comments for the record. “You are locking out the most regulated institutions from a market that they know well, which is custody,” Flood said.
