SEC · CLARITY Act · Bitcoin · Decrypt
SEC Proposes Rules to Clear Up How Advisers and Funds Can Hold Crypto
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The Securities and Exchange Commission is moving to settle one of the thorniest questions in institutional crypto: how professional money managers are supposed to hold the assets.
Key facts
- The proposal, issued under the Investment Advisers Act of 1940 and the Investment Company Act of 1940, would ease that bottleneck in several ways
- The custody plan is the latest piece of a sweeping regulatory build-out the SEC has pursued since the Clarity Act stalled in the Senate
- The Securities and Exchange Commission is moving to settle one of the thorniest questions in institutional crypto: how professional money managers are supposed to hold the assets
- The stated goal is to widen investor access to crypto strategies by removing barriers that have kept advisers on the sidelines
Summary
The SEC proposed a tailored framework for how registered investment advisers and regulated funds can custody crypto, seeking to clarify which arrangements satisfy the "qualified custodian" standard that has long kept firms hesitant to offer digital-asset strategies. The plan would permit self-custody under certain conditions, allow state trust companies to serve as custodians, and update audit and broker-dealer custodial rules. It's the latest in the SEC's post-Clarity Act build-out, alongside the innovation exemption and Regulation Crypto Assets. The agency on Wednesday proposed a tailored framework governing how registered investment advisers and regulated funds can custody crypto, aiming to replace years of regulatory ambiguity with a clear compliance path.