U.S. SEC revamps crypto rules
U.S. SEC revamps crypto rules
The U.S. Securities and Exchange Commission (SEC) announced on Thursday the rescission of Staff Accounting Bulletin (SAB) No. 121, marking a pivotal regulatory change for the crypto industry.
This decision, led by Commissioner Hester Peirce and the agency’s new crypto task force, signals a shift toward simplifying compliance requirements for companies handling digital assets.
SAB 121, introduced in March 2022, mandated companies to record both a liability and a corresponding asset for cryptocurrency holdings managed on behalf of users. Critics, including Peirce, viewed this approach as overly complex and unfairly burdensome for crypto platforms compared to traditional financial institutions.
Under the revised guidelines, companies will assess their safeguarding obligations using broader accounting standards, such as U.S. Generally Accepted Accounting Principles (GAAP) contingency rules and International Financial Reporting Standards (IFRS). These updates apply retroactively to fiscal years beginning after December 15, 2024, though early adoption is permitted.
Implications for the U.S. crypto market
Industry leaders view this development as a potential turning point for cryptocurrency adoption in the United States. Kristin Smith of the Blockchain Association highlighted the move as an opportunity to unlock new market potential, particularly as interest in digital assets like Bitcoin and Ethereum continues to grow.
While spot ETFs for Bitcoin and Ethereum are now trading on Wall Street, regulatory uncertainty and associated risks have kept many U.S. investors and businesses on the sidelines. The SEC’s decision to streamline crypto accounting rules could reduce barriers and encourage broader participation in the digital asset economy.
As the regulatory environment evolves, the SEC’s actions are likely to shape the future of crypto innovation and integration into the mainstream financial system.
