SEC moves to clear custody hurdle for advisers offering crypto
Custody requirements have kept some investment advisers from offering certain crypto to clients, a regulatory hurdle the SEC’s proposal could remove.
The U.S. Securities and Exchange Commission has put forward a proposal aimed at removing custody-related barriers that have prevented investment advisers from offering certain cryptocurrency products to their clients. The regulatory move signals a shift in the agency's approach to how advisers can handle and safeguard digital assets on behalf of investors.
Under existing custody rules, investment advisers are required to ensure client assets are held with a qualified custodian. For many crypto assets, meeting that standard has proven difficult, as the infrastructure for compliant digital asset custody has lagged behind traditional finance. This gap has effectively limited the range of crypto products that registered advisers could legally offer to their client base.
The SEC's proposal, if adopted, could significantly expand access to crypto investment products through regulated financial intermediaries. Industry participants have argued that clearer custody guidelines would allow more advisers to enter the digital asset space, potentially increasing institutional and retail participation in crypto markets through established, compliant channels.
Market observers will be watching closely for the formal comment period on the proposal, during which industry stakeholders, legal experts, and crypto firms are expected to weigh in. The timeline for finalizing any rule change remains uncertain, and the proposal will need to navigate the standard rulemaking process before taking effect.
Source: Cointelegraph
