The U.S. Securities and Exchange Commission (SEC) has introduced new rules designed to facilitate the custody of cryptocurrencies by investment advisers and regulated funds. This proposal is part of a broader initiative to modernize outdated custody regulations that have hindered advisers from offering crypto-related investments.
Under the new framework, registered investment advisers, investment companies, and business development companies would have clearer guidelines for holding crypto assets, including the option for self-custody in certain situations. Additionally, state trust companies could act as custodians for clients' crypto assets.
SEC Chairman Paul Atkins emphasized that the current regulations have not kept pace with the rapid growth of digital assets, which now represent a multi-trillion-dollar market. The proposal follows the stalling of the Clarity Act, a comprehensive crypto market structure bill, in the Senate, indicating the SEC's commitment to establishing a regulatory framework for digital assets.
This regulatory push coincides with a resurgence in the crypto market, as Bitcoin has seen a recovery of over 40% since its July low, driven by improved risk appetite among investors. The proposed rules will be open for public comment for 60 days once published in the Federal Register, marking a significant step in the SEC's efforts to reshape the regulatory landscape for cryptocurrencies