Joe Biden caught the cryptocurrency market off guard by vetoing a bill related to crypto, after abstaining from using this power the previous week. This decision came at a crucial time during an intense election where cryptocurrencies could have a significant impact.
On the last day of May, Joe Biden vetoed a resolution by Congress disapproving of the U.S. Securities and Exchange Commission’s (SEC) accounting bulletin on crypto assets – the SAB 121. He cited concerns that the resolution, led by Republicans, would limit the SEC’s ability to regulate and address future issues effectively.
Interestingly, Biden’s administration had initially indicated it would not use the veto on a different crypto-related bill, as Donald Trump gained popularity. Trump’s endorsement of the FIT21 Act, which passed with a significant majority, had put him in the good graces of crypto enthusiasts.
However, Trump’s conviction on multiple charges related to falsification of business records shifted the dynamics of the election in Biden’s favor. Biden’s decision to veto the crypto bill signaled a shift in his stance on cryptocurrencies, potentially impacting the upcoming elections.
Not only did the crypto community oppose Biden’s veto, but Wall Street lobbying groups also urged him to reconsider his decision. They highlighted the implications of the SAB 121 on regulated banking organizations offering digital asset custody at scale.
Despite the backlash, some cryptocurrency developers viewed the veto as a positive development for the industry’s ethos, particularly in terms of self-custody. They argued that the veto could discourage banks from controlling Bitcoin custody, ultimately benefiting the self-custody sector.
As the United States awaits further developments in the coming weeks, investors are closely monitoring how the government’s stance on innovation evolves, which could influence their investment decisions in the crypto market leading up to the 2024 presidential elections.
