SEC’s decision to revoke SAB 121 marks a win for crypto

The move is seen as a victory for the cryptocurrency industry and has been welcomed by both crypto advocates and the banking sector.

A judge temporarily halted the SEC's lawsuit against Binance to explore a resolution.

In a significant move for the cryptocurrency sector, the US Securities and Exchange Commission (SEC) has rescinded its controversial 2022 accounting guidance, Staff Accounting Bulletin (SAB) 121, which had been heavily criticised by the industry. The decision marks a shift in policies under President Donald Trump’s administration and is seen as a victory for crypto advocates.

SAB 121 required companies holding digital assets on behalf of others to treat them as liabilities, increasing operational costs. The crypto industry and its supporters, including crypto-friendly lawmakers, had long objected to the measure. Despite the SEC’s former chair Gary Gensler defending it as a safeguard for investors, particularly in cases of bankruptcy, the banking industry welcomed its removal.

In a statement, Paige Pidano Paridon of the Bank Policy Institute praised the decision, stating that it restores banks’ ability to serve as a secure option for digital asset custody. The SEC also announced the creation of a crypto task force, led by Republican Commissioner Hester Peirce, who expressed her approval of the decision on social media.