SEC proposes easing crypto custody rules for advisers and regulated funds

The U.S. Securities and Exchange Commission proposed rules on Thursday to make it easier for investment advisers and regulated funds to hold crypto assets for clients. The proposal would establish a custody framework for registered investment advisers, investment companies and business development companies. The SEC says the changes aim to modernize decades-old custody requirements and remove barriers that have limited advisers' ability to offer crypto-related investments. Under the proposed rules, crypto assets could be held in self-custody under certain circumstances. State trust companies could serve as custodians for crypto assets belonging to clients and regulated funds. The SEC said the changes could give regulated funds greater scope to offer crypto-related investment strategies. SEC Chairman Paul Atkins said existing regulations had not kept pace with digital assets, which have grown into a multi-trillion-dollar market. Atkins said the proposal would give advisers and funds a compliant pathway for crypto custody. U.S. regulators are developing crypto rules under their existing authority after the Clarity Act, a sweeping crypto market structure bill, stalled in the Senate in September. The SEC will accept public comments for 60 days after the proposal is published in the Federal Register. Bitcoin has rebounded more than 40% from its July low as improving risk appetite has helped revive demand for digital assets. The recovery follows a prolonged downturn from late 2025 into the first half of 2026.