The US Senate has recently approved a bill that overturns SEC guidelines discouraging banks and major financial institutions from holding Bitcoin and other cryptocurrencies. This legislation, which was previously passed in the House of Representatives, has now received a 60-38 vote in the Senate and is on its way to President Biden for approval.

The bill specifically reverses an accounting rule imposed by the SEC, which mandates that banks must classify crypto assets held on behalf of clients as liabilities on their balance sheets. This change in policy has been welcomed by pro-Bitcoin Senator Cynthia Lummis, who believes it marks the beginning of a new era of support for the crypto industry in the political landscape. She sees this as a significant win for financial innovation and a clear rejection of the crypto-related actions taken by the Biden administration and SEC Chair Gary Gensler. Lummis also highlights that this is the first time Congress has passed standalone legislation specifically addressing cryptocurrencies, signaling a promising start.

Republican Representative Mike Flood, the author of the resolution, explains that the aim of the bill is to ensure consumer protection by removing obstacles that prevent heavily regulated banks from acting as custodians of digital assets.

However, the Biden Administration has expressed strong opposition to the bill and has vowed to veto it. They argue that it would unduly limit the SEC’s ability to establish appropriate safeguards and address potential future issues related to crypto-assets, including those concerning financial stability.

Please note that opinions expressed in this article are not investment advice, and investors should conduct their own research before engaging in high-risk investments involving Bitcoin, cryptocurrencies, or digital assets. Transfers and trades in these assets are undertaken at one’s own risk, and any resulting losses are the responsibility of the individual. The Daily Hodl does not endorse the buying or selling of cryptocurrencies or digital assets, and is not an investment advisor. It is important to be aware that The Daily Hodl engages in affiliate marketing.

Featured Image: Shutterstock/Larich