President Joe Biden has rejected a House Joint Resolution aimed at repealing the Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin 121, a contentious directive mandating financial institutions holding cryptocurrency for clients to report these assets on their balance sheets. The veto, disclosed on Friday afternoon, underscores Biden’s dedication to safeguarding consumers and investors.

In his official statement, Biden stressed his disapproval of any actions that might jeopardize the interests of consumers and investors. He highlighted that the Republican-backed resolution, utilizing the Congressional Review Act, could unreasonably restrict the SEC’s capacity to implement crucial protections and tackle emerging challenges. Biden expressed concerns that nullifying the SEC staff’s considered decision in this manner could erode the SEC’s broader control over accounting standards.

Biden’s veto is consistent with his previous statements advocating for collaborative legislation to establish comprehensive regulations for the digital asset sector. He reiterated the importance of setting up appropriate safeguards to ensure the well-being of consumers and investors.

The veto responds to fervent lobbying from banking associations and congressional members, who had urged Biden to endorse the resolution. Critics of SAB 121 contend that it obstructs regulated banks from providing crypto custody services, as highlighted by the Government Accountability Office.

The resolution had garnered substantial support in both the House and the Senate. Earlier on Friday, Senator Ron Wyden (D-Ore.), a proponent of the resolution, voiced reservations at CoinDesk’s Consensus 2024 conference in Austin, Texas. Wyden argued that the SEC’s guidance imposes disparate standards on crypto in comparison to other assets in the financial domain.

Despite the significant backing from Congress for overturning SAB 121, Biden’s veto underscores his administration’s position on upholding stringent oversight and regulatory clarity in the fast-evolving crypto realm.