The U.S. Securities and Exchange Commission (SEC) rescinded Accounting Bulletin (SAB) No. 121 on Thursday, signaling a change in its approach to regulating cryptoassets under Commissioner Hester Peirce, who now leads the Task Force newly formed cryptographic agency.
Introduced in March 2022, SAB 121 required companies to record a liability and corresponding asset for crypto assets held in users’ names.
Critics, including Peirce, have argued that the guidelines have added unnecessary complexity and created an uneven playing field for crypto platforms.
Under the revised framework, companies will now assess obligations to safeguard cryptoassets using broader accounting standards, such as the US GAAP contingency rules and IFRS guidance.
The changes are retroactive for fiscal years beginning after December 15, 2024, with early adoption permitted.
This move alone could mark the start of a new chapter for crypto in the United States, said Kristin Smith of the Blockchain Association Decrypt.
“It really opens up a whole new market,” she said at the time.
Even though Bitcoin and ETFs Spot Ethereum are currently trading on Wall Street, an abundance of yellow tape and crypto-related anxieties has kept most US investors and businesses on the sidelines.
Peirce, a vocal advocate for clearer crypto regulation, has emphasized collaboration and practical solutions in his new role. His task force aims to reduce reliance on law enforcement-led tactics, which were a hallmark of former SEC Chairman Gary Gensler’s tenure.
The SEC reiterated the need for companies to provide transparent disclosures to investors under existing rules as it adjusts its regulatory posture toward crypto.
In 2024, a bipartisan coalition of U.S. lawmakers passed a resolution in both houses that would have overturned SAB 121, but President Biden vetoed the bill, defending the regulator’s judgment.
“This reversal of the SEC staff’s considered judgment in this manner risks undermining the SEC’s broader authorities regarding accounting practices.” The White House notice read. “My administration will not support measures that undermine the well-being of consumers and investors.”
But it’s a new era under President Donald Trump, who was inaugurated Monday after running a pro-Crypto campaign. On Thursday, Trump signed his first crypto executive order, which establishes a presidential task force to advocate for crypto regulation, as well as to explore a potential national crypto stock. It also prohibits the creation of a central bank digital currency, or CBDC, aka a “digital dollar.”
Editor’s note: This story was updated after publication with additional details.
Daily debriefing Newsletter
Start each day with the best stories right now, plus original features, a podcast, videos and more.
