SEC Proposes Crypto Custody Rules for Investment Advisers and Funds
The proposal would let advisers and funds use state trust companies as crypto custodians and allow self-custody under certain conditions.
The US Securities and Exchange Commission (SEC) has proposed new rules for how investment advisers and investment funds can hold crypto assets. It is a proposal, not a final rule.
What happened
The SEC published the proposal on October 1. According to The Block and Decrypt, it would:
- let advisers and funds use state trust companies as custodians for crypto assets, and
- permit self-custody under certain conditions.
Decrypt describes the aim as replacing years of ambiguity with a clear compliance path. CoinDesk reports that the proposal comes as Commissioner Hester Peirce, the first head of the SEC's Crypto Task Force, leaves the agency this week.
Why it matters
For years, uncertainty about who may hold crypto on behalf of clients has kept many advisers and funds away from the asset class. Clear custody rules could make it easier for regulated money managers to offer crypto exposure. Because this is a proposal, the details can still change before any final rule is adopted.
What it means for you
If you invest through an adviser or fund, ask who actually holds the crypto and under what rules. Our guide to custodial vs non-custodial wallets explains the trade-offs between letting someone else hold your coins and holding them yourself.
Sources
- SEC proposes new crypto custody rules for investment advisers and funds — CoinDesk
- SEC proposes framework allowing investment advisers, funds to self-custody crypto — The Block
- SEC Proposes Rules to Clear Up How Advisers and Funds Can Hold Crypto — Decrypt
- SEC Proposes New Rules On Crypto Custody — Bitcoin Magazine