SEC Sends Crypto Custody Overhaul to White House Review

The U.S. Securities and Exchange Commission (SEC) has sent its planned crypto custody overhaul to the Office of Management and Budget for White House review.

The SEC's draft proposal aims to modernize custody rules under the Investment Advisers Act and Investment Company Act, addressing concerns about holding digital assets while meeting current custody requirements.

The agency has not disclosed which provisions it wants to remove or rewrite, nor announced new standards for wallets, private keys, segregation, audits, or eligible custodians. However, the draft differs from the SEC's 2023 Safeguarding Advisory Client Assets proposal, which was formally withdrawn in June 2025.

The current adviser rule already sets a baseline for client assets, but the new proposal targets investment advisers and investment companies that handle digital assets for clients. The agency says firms have asked how they can hold crypto while meeting existing requirements, and clearer rules could reduce compliance uncertainty around managed Bitcoin and other digital assets.