The U.S. Securities and Exchange Commission (SEC) proposed new rules on Oct. 1, aimed at making it clearer how investment advisers and regulated funds can hold crypto assets for clients. The
The U.S. Securities and Exchange Commission (SEC) proposed new rules on Oct. 1, aimed at making it clearer how investment advisers and regulated funds can hold crypto assets for clients.
The proposal would create a tailored custody framework for registered investment advisers, investment companies and business development companies.
It would also allow crypto to be held through state trust companies and, in some cases, through self-custody arrangements.
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If adopted, the proposal could make it easier for investment advisers and regulated funds to hold crypto on behalf of clients instead of relying on rules written decades before digital assets existed.
SEC Chair Paul Atkins said the crypto market has grown from a "niche curiosity" into a "multi-trillion-dollar asset class" since Bitcoin's launch in 2009 but the existing rules and regulations had failed to keep pace with it.
“Today’s proposal would provide a clear regulatory framework for the custody of crypto assets, giving investment advisers and funds a compliant pathway where none existed before,” Atkins said.
The proposal will remain open for public comment for 60 days before the SEC considers whether to adopt a final rule.
The custody proposal is the latest in a series of crypto measures advanced by the SEC over the past two months.
On Aug. 18, the agency proposed Regulation Crypto Assets, its first tailored offering framework for certain crypto investment contracts. The proposal would create new exemptions for some token offerings and establish a conditional safe harbor for crypto assets that no longer meet the definition of an investment contract.
Then, on Sept. 17, the SEC introduced its Innovation Exemption, allowing qualifying venues to facilitate onchain trading of tokenized U.S. stocks under temporary conditions while the agency works on longer-term rules.
That action came within days of the Senate failing to advance the CLARITY Acton Sept. 15, leaving comprehensive crypto market structure legislation stalled. Atkins had already signaled that the SEC would keep moving even without Congress.
“With or without that legislation, this Administration will deliver for American investors and technological innovators,” Atkins said at a Sept. 14 Solana Policy Institute summit. “Promises were made, and they will be kept.”
