{"id":40673,"date":"2025-01-24T07:08:00","date_gmt":"2025-01-24T12:08:00","guid":{"rendered":"https:\/\/bitcoinmagazine.com\/?p=40673"},"modified":"2025-02-20T13:00:48","modified_gmt":"2025-02-20T18:00:48","slug":"sec-rescinds-sab-121-permitting-banks-to-custody-bitcoin","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/business\/sec-rescinds-sab-121-permitting-banks-to-custody-bitcoin","title":{"rendered":"SEC Rescinds SAB 121, Permitting Banks to Custody Bitcoin"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div>\n<p>In a landmark decision, the U.S. Securities and Exchange Commission (SEC)\u00a0<a href=\"https:\/\/www.sec.gov\/rules-regulations\/staff-guidance\/staff-accounting-bulletins\/staff-accounting-bulletin-122\" target=\"_blank\" rel=\"noopener\">has officially rescinded<\/a>\u00a0Staff Accounting Bulletin (SAB) No. 121, a controversial rule that had long hindered banks from offering bitcoin and crypto custody services.\u00a0This move, announced on Thursday, signals a significant shift in the SEC&#8217;s approach to regulating bitcoin and crypto and paves the way for greater financial integration.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">BREAKING: \ud83c\uddfa\ud83c\uddf8 SEC OFFICIALLY RESCINDS SAB 121, WHICH PREVENTED BANKS FROM CUSTODYING <a href=\"https:\/\/twitter.com\/hashtag\/BITCOIN?src=hash&amp;ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener\">#BITCOIN<\/a> <a href=\"https:\/\/t.co\/VCnggkCGmL\">pic.twitter.com\/VCnggkCGmL<\/a><\/p>&mdash; Bitcoin Magazine (@BitcoinMagazine) <a href=\"https:\/\/twitter.com\/BitcoinMagazine\/status\/1882564060157477307?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener\">January 23, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Introduced in March 2022 under former SEC Chair\u00a0<a href=\"https:\/\/bitcoinmagazine.com\/tags\/gary-gensler\">Gary Gensler<\/a>, SAB 121 required institutions holding bitcoin and crypto assets for customers to record those holdings as liabilities on their balance sheets. This accounting standard created significant operational and financial burdens for banks and custodians, effectively discouraging them from providing bitcoin-related services. The rule was widely criticized by the crypto industry and lawmakers, with SEC Commissioner\u00a0<a href=\"https:\/\/bitcoinmagazine.com\/tags\/hester-peirce\">Hester Peirce<\/a>\u00a0famously calling it a &#8220;pernicious weed&#8221; in April 2023.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<div class=\"youtube-embed\" data-video_id=\"F3VTAn102X4\"><iframe loading=\"lazy\" title=\"Michael Saylor&#039;s 21-Year Bitcoin Price Forecast\" width=\"696\" height=\"392\" src=\"https:\/\/www.youtube.com\/embed\/F3VTAn102X4?feature=oembed&#038;enablejsapi=1\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/div>\n<\/div><\/figure>\n\n\n\n<p>&#8220;Bye, bye SAB 121! It&#8217;s not been fun,&#8221; Peirce&nbsp;<a href=\"https:\/\/x.com\/HesterPeirce\/status\/1882562977985114185\">wrote in a post on X<\/a>&nbsp;(formerly Twitter) on Thursday, following the SEC&#8217;s issuance of Staff Accounting Bulletin No. 122, which formally rescinds the guidance.<\/p>\n\n\n\n<p>The SEC&#8217;s move to rescind SAB 121 comes just days after Gensler&#8217;s resignation and marks the start of a new era under Republican leadership. Acting SEC Chair Mark Uyeda, who assumed the role on Monday,&nbsp;<a href=\"https:\/\/x.com\/BitcoinMagazine\/status\/1881761460961079434\">quickly announced<\/a>&nbsp;the formation of a crypto task force led by Peirce to craft clearer and more practical regulatory frameworks for the industry.<\/p>\n\n\n\n<p>&#8220;To date, the SEC has relied primarily on enforcement actions to regulate crypto retroactively and reactively, often adopting novel and untested legal interpretations along the way,&#8221; the agency acknowledged&nbsp;<a href=\"https:\/\/www.sec.gov\/newsroom\/press-releases\/2025-30\" target=\"_blank\" rel=\"noopener\">in a statement<\/a>&nbsp;on Tuesday.<\/p>\n\n\n\n<p>With the removal of SAB 121, major banks are now expected to move swiftly to integrate bitcoin and crypto custody services into their offerings. This is a significant milestone in the financialization of bitcoin, bringing it closer to mainstream adoption.&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The SEC has rescinded SAB 121, removing barriers for banks to custody Bitcoin and crypto, signaling a major shift in crypto regulation.<\/p>\n","protected":false},"author":2513,"featured_media":40676,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[823,2650,183],"class_list":{"0":"post-40673","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-gary-gensler","9":"tag-hester-peirce","10":"tag-sec"},"author_data":{"id":2513,"name":"Vivek Sen","nicename":"vivek-sen-bitcoin","avatar_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2025\/03\/cropped-vivek-96x96.jpg"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2025\/02\/not-a-great-precedent-commissioner-discusses-the-secs-latest-etf-decision.jpg","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/40673","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2513"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=40673"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/40673\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/40676"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=40673"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=40673"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=40673"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}