SEC plans crypto self-custody rules for advisers

• SEC Chair Paul Atkins has asked staff to develop rules allowing advisers to self-custody crypto assets under conditions.
• State trust companies could also hold crypto for investment advisers and regulated funds.
• The custody plan forms one part of a broader SEC crypto framework covering issuance and transfers.

The US Securities and Exchange Commission has begun developing a proposal that could let investment advisers self-custody crypto assets under certain conditions.

SEC Chair Paul Atkins disclosed the plan on September 14 at the Solana Policy Institute Summit, covering assets held for clients and regulated funds.

“As to self-custody, yes, because for too many assets a qualified third-party custodian simply does not exist yet,” said Atkins.

The proposal would also consider allowing state trust companies to serve as custodians for advisers and regulated funds.

The custody plan would sit alongside the SEC’s Regulation Crypto Assets proposal, which includes potential exemptions for offerings of up to $5 million over four years or $75 million in a 12-month period.

Atkins has also backed the CLARITY Act, while the Senate failed to advance the bill on September 15 after a 49-50 procedural vote.

The SEC’s wider framework also includes proposed changes to transfer-agent rules covering blockchain technology, recordkeeping, securities offerings and share transfers.