SEC proposes rules to ease crypto custody for funds and advisers

The U.S. Securities and Exchange Commission has proposed new rules intended to make it easier for registered investment advisers and regulated funds to hold cryptocurrencies on behalf of their clients, the agency said.

The proposal would adjust existing custody requirements that currently govern how advisers and funds safeguard client assets, extending more workable treatment to digital assets such as cryptocurrencies.

Addressing a long-standing industry complaint

Investment firms have argued for years that unclear or burdensome custody rules have discouraged many traditional advisers and funds from offering direct cryptocurrency exposure to clients, pushing investors instead toward indirect products.

If adopted, the proposed rules could remove some of those operational obstacles, potentially opening the door to wider institutional participation in digital asset markets through regulated channels.

The SEC has not specified a timeline for finalizing the rules. As with other agency rulemakings, the proposal is expected to go through a public comment period before any final version is adopted.

The move comes amid a broader effort in Washington to establish clearer regulatory frameworks for digital assets, as lawmakers and regulators face continued pressure from the financial industry to provide more certainty around crypto custody, trading and oversight.