Key Takeaways
- • The SEC proposed a tailored framework for the custody of crypto assets by registered investment advisers and regulated funds, including registered investment companies and business development companies, according to an SEC.gov release dated Oct. 1, 2026.
- • The proposal would permit crypto assets to be held in self-custody by advisers under certain circumstances, subject to significant conditions reported across multiple outlets.
- • The rules would allow state trust companies to act as custodians for client and regulated fund crypto assets.
- • The proposal amends rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940, including financial statement audit requirements and broker-dealer custodial services for regulated funds.
- • A public comment period of 60 days will open following publication of the proposing release in the Federal Register.
Summary
The Securities and Exchange Commission on October 1, 2026 proposed new rules and amendments creating a tailored framework for how registered investment advisers and regulated funds, including registered investment companies and business development companies, may custody crypto assets, according to the SEC's published release. The Commission said the proposal would modernize custody rules and expand investor choice by removing regulatory barriers that inhibit advisers from providing crypto-related investment advice, and would allow regulated funds to offer clients access to a wider range of crypto asset-related investment strategies.
SEC Chairman Paul S. Atkins framed the proposal as a response to rules that have not kept pace with the market. In a statement, Atkins noted that the crypto asset market has grown from a niche asset since Bitcoin's 2008 introduction into a multi-trillion-dollar asset class, and said the proposal would replace "the grey of uncertainty created by custody rules crafted for a bygone era" with a compliant pathway for advisers and funds.
According to coverage of the proposal, the framework would permit crypto assets to be held in self-custody under certain circumstances, subject to significant conditions, and would allow state trust companies to serve as custodians for client and regulated fund crypto assets. The proposal also updates other requirements, including financial statement audit requirements for registered investment advisers, and removes a custody rule requirement that accounting firms performing specified audit and examination engagements be registered with the Public Company Accounting Oversight Board.
The public comment period will remain open for 60 days after the proposing release is published in the Federal Register. Final rules have not been adopted.
SEC Chairman Paul S. Atkins framed the proposal as a response to rules that have not kept pace with the market. In a statement, Atkins noted that the crypto asset market has grown from a niche asset since Bitcoin's 2008 introduction into a multi-trillion-dollar asset class, and said the proposal would replace "the grey of uncertainty created by custody rules crafted for a bygone era" with a compliant pathway for advisers and funds.
According to coverage of the proposal, the framework would permit crypto assets to be held in self-custody under certain circumstances, subject to significant conditions, and would allow state trust companies to serve as custodians for client and regulated fund crypto assets. The proposal also updates other requirements, including financial statement audit requirements for registered investment advisers, and removes a custody rule requirement that accounting firms performing specified audit and examination engagements be registered with the Public Company Accounting Oversight Board.
The public comment period will remain open for 60 days after the proposing release is published in the Federal Register. Final rules have not been adopted.
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