SEC crypto custody overhaul heads to White House for review
Sector-wide, custody standards for investment advisers and funds holding digital assets have resisted a clean answer. The Securities and Exchange Commission has now sent a proposed overhaul of those rules to the White House for…
Key takeaways
- The SEC has sent a proposed overhaul of custody rules for digital assets to the White House for executive review.
- The rulemaking would clarify how investment advisers and funds hold digital assets for clients.
- The overhaul addresses how existing custody obligations under securities law apply specifically to digital assets.
- Any investment adviser or fund holding digital assets for clients would fall under the new standard once the rule is finalized.
- The proposal's clarifying effect is conditional and holds until the White House review concludes and a final rule is published.
Sector-wide, custody standards for investment advisers and funds holding digital assets have resisted a clean answer. The Securities and Exchange Commission has now sent a proposed overhaul of those rules to the White House for review. The rulemaking, if finalized, could clarify how investment advisers and funds hold digital assets for clients.
The proposal addresses a structural point. Investment advisers and funds operating under securities law carry custody obligations when holding client assets, and the SEC's overhaul addresses how those obligations apply to digital assets specifically. That process is now in executive review.
The potential reach is broad. Any investment adviser or fund holding digital assets for clients would come under a new standard once the rule is final. The proposal is described as something that could clarify custody requirements, and that conditional holds until the White House review concludes and a final rule is published.
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