U.S. Senator Warren Supports SEC’s Controversial Crypto Asset Accounting Standard SAB 121

US Senator Elizabeth Warren expressed support for SEC Staff Accounting Bulletin (SAB) 121 during a recent Senate hearing. Warren stated that the standard applies to companies dealing with cryptocurrency business, and aims to provide accounting guidance on how companies should consider risks related to cryptocurrency and disclose these risks in their disclosures. Related risks include hacking, theft, and the loss of cryptocurrency when protecting the company from bankruptcy.Warren added that the standard does not require cryptocurrency platforms to add customers' cryptocurrency to their balance sheets - a statement that contradicts the claim made by Patrick McHenry, Chairman of the House Financial Services Committee, who previously stated that the bill "requires financial institutions and companies that protect customer digital assets to retain these assets on their balance sheets." In addition, this standard does not make the platform the owner of its customers' cryptocurrency. (CryptoSlate)Yesterday, the US Senate voted 60-38 to overturn a resolution on SEC SAB 121, but the resolution may be vetoed by President Biden's desk. It is reported that the SEC's previously issued Staff Accounting Bulletin 121 SAB 121 requires companies to record their holdings of cryptocurrency assets on their balance sheets, but critics argue that this provision is too stringent and essentially hinders major custodial institutions and companies from holding cryptocurrency assets for their clients.