Circle’s CEO Jeremy Allaire opposed SEC regulations during his recent Reuters interview. He said these rules stop banks from adopting cryptocurrency technology. Staff Accounting Bulletin 121 puts financial pressure on banks and companies when they want to use digital assets for business operations.
Under this regulation banks must include crypto assets as balance sheet liabilities which leads to more capital needs and higher expenses for auditing and accounting work. Allaire explains that under this guidance financial institutions must deal with substantial obstacles when thinking about implementing or owning cryptocurrencies.
Banks and corporations face financial penalties for keeping crypto assets on their balance sheets according to Allaire during the interview. Although Circle partners with banks to run USD Coin operations SAB 121 prevents banks from integrating crypto services more widely.
Push for Policy Repeal
Allaire urges the immediate cancellation of the rule while hoping President Trump will take action as a leader of crypto because Trump has shown strong crypto support. Allaire announced her full support for SAB 121’s elimination and hopes President Trump will step in to dismantle it.
Prior to his presidency Trump made clear promises about crypto regulation and plans to release executive orders that support innovation and decrease regulation trouble. People are unsure when these actions will take place.
Support from Industry Leaders
The Chief Policy Officer at Coinbase Faryar Shirzad supported Timothy Allaire’s position. Shirzad explained to Reuters that the new administration wants to build regulations that will allow banks to handle digital asset custody operations. The new government will push banks to offer crypto custodial services according to Shirzad’s predictions.
Allaire and Shirzad noted how Congress will influence the development of crypto regulation. Allaire anticipates Congress will start taking action in the next weeks to create regulations that help crypto development without risking the financial system.
Implications for the Crypto Sector
People widely discuss the effects this SEC directive will have on crypto market expansion. The SEC’s rule SAB 121 creates unfair challenges for financial institutions that want to use blockchain and digital assets. Supportive groups say the rule provides necessary protection measures against cryptocurrency risks.
The expanding cryptocurrency industry needs strong regulatory framework from market leaders. Everyone in the crypto sector tracks President Trump and Congress because their future crypto policies will build new links between digital assets and established finance systems.
For now, Allaire’s remarks underscore a growing consensus among crypto advocates: Proper regulation must happen first to enable widespread financial system growth and new developments.
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