Biden vetoes bill that would allow regulated financial firms to custody crypto | Hacker News Reader

Biden vetoes bill that would allow regulated financial firms to custody crypto

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13 pointswslh6 comments

Not sure this title and tweet is quite accurate. This was a veto of an act of congressional disapproval of an SEC rule. I’m not familiar with the underlying rule but the CRA itself might not have actually set proactive rules for firms. This wasn’t like FIT-21, where it’s a new regulatory regime.

> ...to custody crypto

Weird turn of phrase, haven't seen "custody" as a verb before. Pretty sure they mean:

https://www.investopedia.com/selecting-a-qualified-crypto-cu...

Exactly the opposite of the Germany (good) strategy many years ago: start with highly regulated institutions such as banks instead of players such as Coinbase.

For more information look, for example, at the BitLicense [1].

[1] https://x.com/BitcoinMagazine/status/1796676018284953832

Win-win, politically. The crypto lobby is spending massively on lobbying. The veto lets them continue spending and donating into lower races; they’re not going to swing the national vote.

Are you saying that on the one hand ETFs are approved by the SEC but on the other highly regulated institutions could not custody crypto assets as less regulated ones?

> on the one hand ETFs are approved by the SEC but on the other highly regulated institutions could not custody crypto assets like less regulated ones

I never commented on any of this.

Non sequitur notwithstanding, yes. ETPs segregate the risk from the rest of the financial system. Their price discovery doesn’t even require market makers touch the underlying asset.

And there are few assets less regulated than crypto. (Its proponents can’t even agree on whether it should be regulated as a currency, commodity or security.)

Note that custody doesn’t mean hold. Blackrock can hold Bitcoin. It just can’t custody it and pretend it’s holding a regular financial asset.

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