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SEC Sends Crypto Custody Overhaul to White House for Review
The SEC has submitted a proposed rewrite of custody rules to the White House, targeting an October publication. The draft, labeled 'economically significant', could reshape how digital assets are held.
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The SEC has submitted a proposed overhaul of its custody rules to the White House for review, Law360 reported Wednesday. The proposal, titled "Amendments to the Custody Rules" and labeled "economically significant," targets an October publication. The draft is not public.
The rule would apply to investment advisers and investment companies. It would differentiate how traditional and digital assets are held by custodians, according to the report. Current rules for qualified custodians cover registered brokers and banks. Those rules offer no clear framework for crypto assets, leaving lawyers and advisors with questions about what qualifies as a custodian for blockchain assets. The SEC called the proposal a major rewrite of existing custody rules.
The Office of Information and Regulatory Affairs, part of the White House budget office, is reviewing the draft. The SEC can revise the proposal during the review. After OIRA clearance, the SEC needs a commissioner vote and a public comment period. The review process could push the October target later.