The Securities and Exchange Commission's proposed rewrite of crypto custody rules for investment advisers and investment companies entered White House review on August 25, 2026. The proposal, which targets October 2026 for a notice of proposed rulemaking, aims to clarify how firms can custody digital assets. This action follows the SEC's June 2025 withdrawal of a separate 2023 safeguarding proposal that would have expanded custody rules to all client assets.
SEC crypto custody rule proposal
- ▪The Securities and Exchange Commission's regulatory agenda states that advisers and investment companies have raised questions about holding crypto assets in compliance with current custody requirements.
- ▪The Securities and Exchange Commission's proposed rewrite of custody rules aims to clarify how investment advisers and investment companies can custody crypto assets under Commission requirements.
- ▪The Securities and Exchange Commission's regulatory agenda targets October 2026 for a notice of proposed rulemaking regarding the custody rules rewrite, with no legal deadline listed.
White House OIRA regulatory review
- ▪The Securities and Exchange Commission's proposed rewrite of custody rules for investment advisers and investment companies entered White House review on August 25, 2026.
- ▪A 2025 White House order mandates that agencies must continue following Executive Order 12866 processes for submitting regulations to the Office of Information and Regulatory Affairs for review.
- ▪The Office of Information and Regulatory Affairs' current-review data lists RIN 3235-AN46, "Amendments to the Custody Rules," at the proposed-rule stage with an August 25, 2026 date.
Withdrawal of 2023 safeguarding proposal
- ▪The withdrawn February 2023 safeguarding proposal would have expanded the custody rule to all client assets, including crypto, and proposed protections involving segregation and custodian insolvency.
- ▪The Securities and Exchange Commission formally withdrew its February 2023 safeguarding proposal in June 2025, stating that any future regulatory action in the area would require a new proposed rule.
Investment adviser custody requirements
- ▪The Securities and Exchange Commission's proposed rewrite of custody rules covers investment adviser client assets and intends to remove burdens from provisions the agency considers outdated.
- ▪The current Securities and Exchange Commission adviser rule generally requires a qualified custodian to maintain client funds and securities in separate client accounts or accounts held by an adviser as agent or trustee.
Investment company custody requirements
- ▪The Securities and Exchange Commission's proposed rewrite of custody rules covers investment-company fund assets and identifies the action under the Investment Company Act.
- ▪The public records for the Securities and Exchange Commission's proposed custody rule rewrite do not currently show the draft's provisions or specify which entities would qualify to custody crypto.
Debatable claims
- ▪The SEC should ease custody rules for investment advisers
- ▪The SEC should require strict segregation protections for advisory crypto assets
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