{"id":22767,"date":"2026-10-02T08:49:09","date_gmt":"2026-10-02T08:49:09","guid":{"rendered":"https:\/\/generationimpact.global\/?p=22767"},"modified":"2026-10-02T07:48:15","modified_gmt":"2026-10-02T07:48:15","slug":"sec-proposes-crypto-asset-custody-rules-investment-advisers-funds","status":"publish","type":"post","link":"https:\/\/generationimpact.global\/news\/sec-proposes-crypto-asset-custody-rules-investment-advisers-funds\/","title":{"rendered":"US SEC Proposes Framework for Crypto Asset Custody by Investment Advisers and Regulated Funds"},"content":{"rendered":"\n

The US Securities and Exchange Commission has proposed new rules and amendments designed to establish a tailored regulatory framework for crypto asset custody by registered investment advisers and regulated funds.<\/p>\n

Proposed Framework and Regulatory Objectives<\/strong><\/h2>\n

On 1 October 2026, the Securities and Exchange Commission introduced proposed rules and amendments aimed at establishing a dedicated framework for crypto asset custody.<\/p>\n

The proposed regulatory structure applies to registered investment advisers as well as regulated funds, encompassing registered investment companies and business development companies.<\/p>\n

By modernising existing custody requirements, the measures seek to remove regulatory barriers that currently restrict an adviser's ability to provide investment advice on crypto assets.<\/p>\n

The proposed changes would also enable regulated funds to offer client access to a broader range of crypto asset investment strategies.<\/p>\n

Statutory Updates and Custodial Requirements<\/strong><\/h2>\n

The proposed updates fall under the Investment Advisers Act of 1940 and the Investment Company Act of 1940, intended to align rules with current industry practices.<\/p>\n

Specific requirements addressed in the proposal include financial statement audits for registered investment advisers and broker-dealer custodial services for regulated funds.<\/p>\n

Under designated circumstances, the framework permits crypto assets to be held in self-custody.<\/p>\n

Additionally, the rules would allow the use of state trust companies to serve as custodians for client and regulated fund crypto assets.<\/p>\n

Market Context and Public Comment Period<\/strong><\/h2>\n

In a statement accompanying the announcement, SEC Chairman Paul S. Atkins noted that since the creation of Bitcoin in 2008, the crypto asset market has evolved from a niche curiosity into a multi-trillion-dollar asset class.<\/p>\n

Chairman Atkins stated that the new proposal provides a compliant path for advisers and funds, seeking to replace regulatory uncertainty associated with rules designed for earlier eras.<\/p>\n

The public comment period regarding the proposed release will remain open for 60 days following its publication in the Federal Register.<\/p>\n

Frequently Asked Questions<\/strong><\/h2>
\n

Which entities are covered under the SEC crypto custody proposal?<\/h3><\/summary>

The proposal applies to registered investment advisers and regulated funds, including registered investment companies and business development companies.<\/p><\/details>\n

Does the SEC proposal allow self-custody or state trust companies?<\/h3><\/summary>

Yes, the proposed framework permits crypto assets to be held in self-custody under specific circumstances and allows state trust companies to act as custodians.<\/p><\/details>\n

How long is the public comment period for the SEC proposal?<\/h3><\/summary>

The public comment period will remain open for 60 days following publication of the proposing release in the Federal Register.<\/p><\/details>\n<\/div><\/div>