SEC Pushes Forward with Crypto Custody Rewrite Amid CLARITY Act Stalemate
The US Securities and Exchange Commission (SEC) has submitted a proposal to the White House to rewrite how investment advisers and funds hold cryptocurrency for clients. The move comes as the CLARITY Act stalls in the Senate, but the SEC is making progress on regulation through its own rulemaking.
The proposed rule, called 'Amendments to the Custody Rules,' aims to clarify the framework for holding crypto assets under current laws and remove outdated provisions that no longer serve investor protection. The changes will affect both the Investment Advisers Act and the Investment Company Act, which regulate how client assets are held.
The SEC has stated that investment advisers have been seeking guidance on how to legally hold clients' digital assets under existing rules. This move is seen as a faster route to regulation than waiting for the CLARITY Act to pass, with CFTC Chairman Michael Selig stating he will finalize the rules regardless of whether the bill becomes law.