SEC Proposes Rules Allowing Advisers to Hold Crypto Assets Directly
The Securities and Exchange Commission (SEC) has proposed new rules to modernize custody requirements for registered investment advisers and regulated funds under the Investment Advisers Act of 1940 and the Investment Company Act of 1940.
The proposal aims to expand investor choice by removing regulatory barriers that have discouraged advisers from offering crypto-related investment advice. A key provision would permit self-custody of crypto assets under certain circumstances, allowing state-chartered trust companies to serve as qualified custodians alongside federally regulated banks and broker-dealers.
SEC Chairman Paul S. Atkins framed the move against the backdrop of the crypto asset market's growth since 2008, which has become a multi-trillion-dollar asset class.
The proposal will be open for public comment for 60 days following its publication in the Federal Register, giving advisers, custodians, and other market participants an opportunity to weigh in before the SEC finalizes any rule.