Jeremy Allaire, CEO of Circle, has voiced strong support for the Trump administration’s reported plans to repeal Staff Accounting Bulletin 121 (SAB 121), a controversial regulatory guideline introduced during the Biden administration. The guideline mandates stringent accounting rules for firms holding crypto assets on behalf of customers, often inflating their balance sheets and limiting financial flexibility. Allaire argued that repealing SAB 121 could unleash innovation and improve institutional trust in the crypto industry, removing barriers for businesses offering digital asset services.
SAB 121, implemented by the U.S. Securities and Exchange Commission (SEC) in 2022, required companies to list crypto custody assets and associated liabilities on their balance sheets. Critics have long contended that the policy imposes undue financial burdens on firms, discouraging them from entering or expanding within the crypto space. Allaire emphasized that dismantling the regulation would pave the way for broader adoption of blockchain technologies by creating a more business-friendly environment.
The potential repeal has drawn mixed reactions within the financial sector. Proponents, including several major blockchain firms, believe it would encourage banks and fintech companies to participate more actively in crypto markets. On the other hand, detractors caution that the removal of SAB 121 could weaken protections for consumers, leaving them vulnerable in the event of insolvency or mismanagement by custodians.
As the Trump administration moves forward with its proposed reforms, industry experts are closely watching to gauge their impact on the rapidly evolving crypto landscape. For Circle and other digital asset firms, the rollback of SAB 121 could signify a turning point in U.S. regulatory policy, signaling a shift toward fostering innovation and competitiveness in the global crypto market.
