The US Treasury Secretary, Janet Yellen, calls for the introduction of legislative actions to address the risks associated with the digital asset sector.
In anticipation of the discussion at the House Financial Services Committee, Janet Yellen, head of the Financial Stability Oversight Council (FSOC), has emphasized the need for timely regulation of digital assets.
In particular, Yellen has underscored that the FSOC remains committed to addressing the risks and challenges arising from the proliferation of digital assets. These include exchange instability, cryptocurrency price volatility, and the rise of platforms operating outside of or in violation of applicable laws and regulations. These factors have heightened concerns regarding the necessity for regulation and thus legislative action in the field of digital assets.
Yellen has urged Congress to take action, proposing the adoption of laws that address the risks of the cryptocurrency market. Legislators have already begun developing various laws in this regard, including one specific to stablecoins and another for cryptocurrencies that do not fall under the category of securities.
The SAB 121 controversy
In addition to the risks associated with the digital asset market, the House Financial Services Committee will discuss SAB 121, a statement issued by the SEC staff on March 31, 2022, expressing their views on the accounting treatment of entities holding digital assets on behalf of third parties.
The statement requires companies holding cryptocurrencies to record customer assets as liabilities on their balance sheets. This interpretation has caused confusion and received criticism from supporters of the sector.
In response to the SAB 121 statement, Senator Cynthia Lummis and Representatives Mike Flood and Wiley Nickel, known supporters of digital assets, have introduced a resolution aimed at blocking these guidelines.
