SEC Proposes Crypto Custody Rule Updates

The US Securities and Exchange Commission (SEC) has submitted a new proposal to update the regulatory framework for cryptocurrency custody. The proposal, titled 'Amendments to the Custody Rules,' aims to modernize existing regulations regarding how investment advisors and mutual funds must safeguard their clients' assets.

The current rules have been deemed 'outdated' due to market evolution and trading practices, leading the SEC to introduce new rules for crypto assets. The proposal will also remove some existing custody requirements that are no longer relevant.

The White House's Office of Management and Budget (OMB) has received the proposal, which is expected to be evaluated by the SEC before being released to the public for comment. After a 60-day review period, the regulation will require a final vote from the SEC before it goes into effect.