The US SEC softens its stance on the crypto bill SAB-121, and banks are allowed to custody customer assets in a "bankruptcy isolation" manner

Odaily Odaily News BIn a recent speech, Paul Munter, chief accountant of the U.S. Securities and Exchange Commission (SEC), seemed to back down on the SEC's Staff Accounting Bulletin No. 121 (SAB-121), which restricts banks from providing digital asset custody services to customers. According to analysis by Alex Thorn, head of Galaxy Research, Munter proposed some exemptions that allow bank holding companies and introducing brokers to circumvent the custody provisions in SAB-121. Banks can avoid the reporting requirements of SAB-121 if they obtain written permission from state regulators to custody customer assets in a "bankruptcy remote" manner, clearly specify standards in contracts, and conduct regular risk assessments. Introducing brokers can also be exempted from the requirements of SAB-121 by meeting three conditions. Brokers cannot hold customers' private keys, cannot act as third parties in transactions, and cannot be agents of introducing brokers. Finally, introducing brokers must obtain a legal opinion that they are introducing brokers that meet the digital asset exemption conditions. According to previous news, on July 11, the U.S. House of Representatives voted on whether to overturn "President Joe Biden's veto of SAB 121-related resolutions", but it was not passed, and the U.S. Securities and Exchange Commission's cryptocurrency accounting policy remained unchanged.