Republican Senator Cynthia Lummis has addressed a letter to President Joe Biden, urging him to either sign into law or work with the Securities and Exchange Commission (SEC) to rescind the SEC’s Staff Accounting Bulletin-121 (SAB-121).

The bulletin, which was set to come into effect on April 11, 2024, mandated that entities holding Bitcoin for customers must include the Bitcoin as a liability on their balance sheets and issue specific disclosures. Some lawmakers have criticized the guidance, suggesting it could place consumers at risk and deter regulated financial institutions from safeguarding Bitcoin.

Senator Lummis highlighted the contentious nature of SAB-121 and the SEC’s process of issuing the guidance. "By inappropriately issuing guidance instead of engaging in notice and comment rulemaking, the SEC’s rulemaking was able to avoid a vote by the full commission on a contentious policy," Lummis stated in her letter. She further emphasized that this method circumvented the notice and comment provisions of the Administrative Procedure Act (APA), thus barring stakeholders, including banking regulators, from commenting on the policy.

In a significant move, lawmakers in the House of Representatives voted 228 to 182 to repeal the SEC’s guidance, and the Senate followed suit with a decisive vote of 60 to 38 in favor of the repeal. Despite President Biden’s earlier indication that he might veto such a repeal, the White House has recently sought input from companies for future policy, hinting at a possible shift in the administration’s stance towards Bitcoin.

The Bitcoin industry awaits President Biden’s decision as the June 3 deadline approaches. The letter from Senator Lummis, which was also signed by other members of Congress, concludes with a reminder that Congress has sent a “clear bipartisan message” to the SEC by voting to repeal SAB-121, and expresses the belief that the SEC Chair Gary Gensler's refusal to rescind the rule should not prevent the will of Congress from being realized.

The Letter