SAB 122 Is A Bigger Bitcoin Price Catalyst Than The US BTC Reserve

2 months ago

The US Securities and Exchange Commission (SEC) announced connected Thursday, January 23, the rescission of Staff Accounting Bulletin (SAB) No. 121, a directive that had imposed stringent accounting requirements connected crypto custody for US banks and fiscal institutions. The move, encapsulated successful the recently issued SAB 122, is poised to service arsenic a much important catalyst for Bitcoin’s terms dynamics than the anticipated US Bitcoin Reserve (SBR), according to respective manufacture experts.

Implications For Bitcoin

Originally enacted successful 2022, SAB 121 mandated that banks classify customer-held cryptocurrencies arsenic liabilities connected their equilibrium sheets. This classification importantly accrued the operational costs and complexities for fiscal institutions, efficaciously deterring them from offering crypto-related services. Thus, the request acted arsenic a barrier, limiting the integration of Bitcoin and different cryptocurrencies into mainstream banking operations.

The withdrawal of SAB 121 done SAB 122 efficaciously removes this accounting impediment. SEC Commissioner Hester Peirce lauded the determination connected societal media, stating, “Bye, bye SAB 121! It’s not been fun: http://SEC.gov | Staff Accounting Bulletin No. 122.”

The Bitcoin assemblage has responded favorably to the SEC’s decision. Andrew Parish, laminitis of x3, emphasized the value of SAB 122 connected X, asserting, “Rescinding of SAB 121 is simply a bigger catalyst for Bitcoin than the SBR. Bookmark this post.” Similarly, Fred Krueger, laminitis of Troop, highlighted the broader marketplace implications, noting, “SAB 122 is highly bully for Bitcoin. More important than the Bitcoin Reserve, which is besides coming. Now ticker the Banks commencement accumulating.”

Vijay Boyapati, an Ex-Google technologist and the writer of The Bullish Case for Bitcoin, further elaborated connected the transformative imaginable of the SEC’s action, stating, “It truly is hard to stress however immense a oversea alteration we’re witnessing. We went from the worst conceivable anti-Bitcoin, anti-innovation, anti-growth, anti-business medication to the astir affable Bitcoin medication you could anticipation for. This is 100% not priced in.”

Michael Saylor, Executive Chairman of MicroStrategy, succinctly captured the marketplace sentiment with his tweet: “SAB 121 has been rescinded, allowing banks to custody Bitcoin. 🚀” This aligns with Saylor’s antecedently outlined tgree catalysts for Bitcoin reaching $1 million per coin, wherever the facilitation of accepted slope custody stood arsenic past unfastened m factor.

The regulatory easing is expected to catalyze accrued organization information successful the BTC and crypto market. Brian Moynihan, CEO of Bank of America—the second-largest US slope by assets—addressed the imaginable for broader crypto adoption during an interrogation with CNBC’s Andrew Ross Sorkin astatine the World Economic Forum successful Davos, Switzerland. Moynihan stated, “If the rules travel successful and marque it a existent happening that you tin really bash concern with, you’ll find that the banking strategy volition travel successful hard connected the transactional broadside of it.”

This connection aligns with the SEC’s latest directive, indicating that banks are present much apt to make and connection crypto services, including custody solutions, which were antecedently constrained nether SAB 121. The removal of these regulatory hurdles is anticipated to heighten the liquidity and accessibility of Bitcoin, perchance driving a caller question of request akin to the spot ETFs successful January past year.

At property time, BTC traded astatine $105,466.