Washington D.C., Oct. 1, 2026 — The Securities and Exchange Commission today proposed new rules and amendments to provide a tailored framework for the custody of crypto assets for registered investment advisers and regulated funds, including registered investment companies and business development companies.
The Commission’s proposal is designed to modernize existing custody rules and expand investor choice by removing regulatory barriers that have historically inhibited the ability of financial advisers to provide crypto-related investment advice. By addressing these long-standing operational hurdles, the initiative would also allow regulated funds to offer their clients access to a much wider range of crypto asset-related investment strategies, aligning traditional financial markets more closely with evolving consumer demand and digital asset participation.
Addressing the historical gap between the rapid evolution of digital assets and traditional regulatory structures, SEC Chairman Paul S. Atkins emphasized the necessity of the new framework in an official statement released alongside the proposal.
"Since the advent of Bitcoin in 2008, the crypto asset market has grown from a niche curiosity into a multi-trillion-dollar asset class to which investors actively seek exposure," said SEC Chairman Paul S. Atkins. "Unfortunately, our rules and regulations have not kept pace. To that end, today’s proposal would provide a clear regulatory framework for the custody of crypto assets, giving investment advisers and funds a compliant pathway where none existed before—and replacing the grey of uncertainty created by custody rules crafted for a bygone era."
The proposed rules and amendments operate primarily under the regulatory authorities of the Investment Advisers Act of 1940 and the Investment Company Act of 1940. By tailoring these established statutes to the unique technical and operational realities of digital holdings, the Commission aims to better address current industry practices. The package updates a number of requirements relating to key operational safeguards, among them financial statement audits for registered investment advisers and the utilization of broker-dealer custodial services for regulated funds.
Significantly, the sweeping proposal also introduces provisions that would permit crypto assets to be held in self-custody under carefully defined and limited circumstances. Furthermore, it would allow for the use of state trust companies as qualified custodians for client and regulated fund crypto assets, expanding the pool of compliant institutional options available to market participants navigating the digital asset ecosystem.
Market participants, institutional investors, and interested members of the public will have ample opportunity to review the text and provide feedback to the regulator. The public comment period will remain open for 60 days following the official publication of the SEC’s proposing release in the Federal Register.
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