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Highlights
- Stacy Herbert says that the SAB 121 abolition signals the establishment of Bitcoin banks.
- The SEC rescinds SAB 121, allowing banks to hold cryptocurrencies, including Bitcoin.
- US lawmakers have launched investigations into Operation Chokepoint 2.0.
Donald Trump’s crypto policies have ignited a sense of optimism within the industry, hinting at a new era of growth and innovation. The US Securities and Exchange Commission’s decision to rescind SAB 121 has further fueled confidence. Experts hope that the abolition of SAB 121 will pave the way for the establishment of Bitcoin banks.
Notably, Stacy Herbert, Director of El Salvador’s Bitcoin Office, has expressed hopefulness about banks holding Bitcoin. Her statement reflects a general excitement surrounding the integration of Bitcoin and other cryptocurrencies into the US banking industry.
SAB 121 Rescission Greenlights Bitcoin Banking
In a recent X post, Stacy Herbert, the Director of Bitcoin Office, El Salvador, commented on the potential acceptance of Bitcoin in financial institutions. While her optimism is mainly driven by the SEC’s recent abolition of SAB 121, Herbert stated, “Bitcoin banks are coming.”
Herbert’s post came in response to MicroStrategy founder Michael Saylor’s X thread on the withdrawal of SAB 121. She emphasized the benefits of Bitcoin banks, suggesting that integrating Bitcoin into traditional banking could potentially boost investments.
SEC Withdraws SAB 121, Releases SAB 122
In a phenomenal development, the US SEC withdrew Staff Accounting Bulletin No. 121 and released Staff Accounting Bulletin No. 122. While SAB 121 restricted banks’ custody of cryptocurrencies, SAB 122 reverses the rule that forced entities to log a liability when protecting client crypto assets.
SEC Commissioner Hester Peirce, who now lead the newly formed Crypto Task Force, responded to the SAB 121 abolition with an X post that read, Bye, bye SAB 121! It’s not been fun.”
Bye, bye SAB 121! It's not been fun: https://t.co/cIwUc0isUE | Staff Accounting Bulletin No. 122
— Hester Peirce (@HesterPeirce) January 23, 2025
Similarly, Senator Cynthia Lummis expressed her contentment with the SEC’s action, stating,
SAB 121 was disastrous for the banking industry, and only stunted American innovation and advancement of digital assets. I am THRILLED to see it repealed and get the SEC back on track to fulfilling its intended mission.
Trump Government Fights Operation Chokepoint 2.0
Joe Biden’s administration has been accused of stifling the crypto industry by pressuring banks to sever ties with crypto businesses, a move critics have dubbed “Operation Chokepoint 2.0. Coinbase CEO previously said that the Biden government was trying to “kill” the entire crypto ecosystem. The SEC’s SAB 121 was also such a move that stifled the crypto economy.
However, the US lawmakers have recently launched investigations into the matter, examining the government’s regulatory overreach. While many including Brian Armstrong, Hayden Adams, and Paul Grewal have openly raised voices against Operation Chokepoint 2.0, the US Oversight Committee pledged to address the issue.
Regulatory Shifts Mark the Future of Bitcoin Banks
Trump’s executive order that focuses on crypto has ushered in a new era of crypto markets in the US. Recently, the President signed an executive order to develop a national digital asset stockpile, sparking community enthusiasm. These policy shifts, especially the abolition of the controversial SAB 121, signal the emergence of Bitcoin banks.
In anticipation of the US banking industry’s adoption of crypto, Draper University Founder Tim Draper stated,
Goodbye to SAD SAB 121. We welcome banks to the new world of Bitcoin. Banks don’t have to pretend that the dollar is better anymore.
Moreover, Bank of America CEO Brian Moynihan’s assurance that the US banking industry would embrace cryptocurrencies upon regulatory approval has bolstered hopes for mainstream adoption. Circle CEO Jeremy Allaire also remains bullish on the financial institutions’ endorsement of digital assets.
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