SEC Resurrects Crypto Custody Rule Proposal Amid Industry Concerns

The US Securities and Exchange Commission (SEC) is reviving its effort to regulate crypto custody rules, which were previously met with opposition from industry players. The SEC aims to improve and modernize existing regulations for investment adviser client assets, including those related to cryptocurrency.

Last year, the agency proposed a rule that would have required investment advisers to store clients' cryptocurrencies with qualified custodians, such as chartered banks or trust companies. However, the proposal was met with criticism from various stakeholders, including financial firms and regulatory agencies, who argued that it could be overly burdensome.

The SEC has now resubmitted its proposal to the White House Office of Budget and Management for review, where it will undergo further evaluation before being proposed to the public. The agency's goal is to remove outdated provisions and provide clearer guidance on how to comply with custody regulations for cryptocurrency assets.