SEC Proposes Changes To Address Crypto Asset Custody Under Investment Rules

The U.S. Securities and Exchange Commission has proposed changes addressing the custody of crypto assets under investment rules, according to a report originally published by Mealey’s. The proposal places digital-asset custody within the SEC’s broader framework for safeguarding assets handled by investment firms.

Custody rules generally concern how client assets are held, protected and controlled when investment advisers or other regulated entities manage them. Crypto assets can raise distinct custody questions because control may depend on private keys, wallets and third-party service providers rather than traditional account structures.

The SEC’s proposed changes signal continued regulatory attention to the treatment of crypto assets in established financial-services rules. Any final requirements would depend on the agency’s rulemaking process and would help define how investment-market participants address custody responsibilities involving digital assets.