House Resolution on Crypto Custody Nears Senate Passage

IconCNT15 May, 2024

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House Resolution on Crypto Custody Nears Senate Passage

A resolution that would overturn recent accounting guidance on crypto custody responsibilities (SAB 121) and was approved by the U.S. House of Representatives is anticipated to pass the Senate, according to CoinDesk, citing several sources. The resolution has gained support from both Republicans and Democrats, who are concerned about the potential effects of SAB 121 on the cryptocurrency sector. The accounting rule, which was released in March 2023 by the Financial Accounting Standards Board (FASB), mandates banks to classify crypto assets held in custody as liabilities, which might result in higher capital requirements and reduced lending capacity. If adopted by the Senate, the resolution would send a strong message to FASB that Congress does not support SAB 121. It would also increase the possibility of the rule being revised or withdrawn. Previously on May 15, 2024, "A resolution that would nullify recent accounting guidance on crypto custody obligations (SAB 121) passed by the U.S. House of Representatives is likely to pass the Senate, CoinDesk reported, citing multiple sources."

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