The SEC has announced the repeal of the controversial SAB 121 rule, which has faced criticism from the crypto industry. This move promises easier asset management and new opportunities.
Background and Reasons for Repeal
The SAB 121 rule, introduced in March 2022, mandated financial firms to treat cryptocurrencies as liabilities. This requirement was criticized for its complexity. SEC Commissioner Hester Peirce welcomed the repeal on her X account.
Impact on the Crypto Community
The rule's repeal enables financial institutions to provide more accessible custody services for digital assets, enhancing user trust. Institutional custody reduces the risk of private key loss and opens access to more financial services.
Criticism and Future Perspectives
Some in the crypto community note that SAB 121 did not directly address Bitcoin. Critics argue that allowing banks to store Bitcoin contradicts its original decentralized philosophy.
With SAB 121 repealed, banks may become more interested in offering cryptocurrency custody services. Industry participants anticipate normalized relations between financial institutions and digital assets.
