SEC Sends Revised Crypto Custody Regulations to White House
The US SEC has submitted an updated custody rule to the White House for review, seeking to establish clearer operational standards for institutional digital asset managers.
The US Securities and Exchange Commission has forwarded a revised digital asset custody framework to the White House Office of Information and Regulatory Affairs. The updated rule targets investment advisers and registered investment companies holding crypto assets on behalf of clients.
This submission follows the withdrawal of an earlier 2023 proposal that faced substantial pushback from institutional custodians and crypto trade groups. The new draft aims to provide more explicit compliance pathways for registered entities managing client holdings.
If enacted, the regulation will set stricter operational and segregation requirements for qualified custodians handling digital assets. Clear federal custody rules could reduce legal ambiguity, potentially encouraging more traditional asset managers to allocate capital to digital asset funds.
Key takeaways
- The SEC forwarded an updated investment adviser custody rule to the White House for official review.
- The revised framework replaces a contentious 2023 draft that drew widespread industry pushback.
- Final approval would define explicit compliance requirements for institutional digital asset custodians.