SEC Proposes New Rules to Modernize Crypto Custody for Investment Advisers

SEC Submits Crypto Custody Proposal to White House

The U.S. Securities and Exchange Commission (SEC) has sent a proposal to the White House to update rules for how investment advisers and companies hold crypto assets. The proposal aims to "clarify the framework for the custody of crypto assets" and modernize existing regulations.

The SEC stated that the rule change would remove outdated requirements and better protect investors as markets and security practices evolve. The proposal was submitted on Tuesday, according to a public notice.

Why the Proposal Was Submitted Now

The SEC’s move comes as a vote on the Clarity Act—a separate bill meant to define crypto regulations—has been delayed until September. Some lawmakers, including Republican Senator Cynthia Lummis, have accused Democrats of deliberately slowing the bill’s progress.

Despite the delay, regulators like the SEC and the Commodity Futures Trading Commission (CFTC) say they will continue shaping crypto policy. CFTC Chairman Michael Selig has stated he will proceed with rulemaking regardless of whether the Clarity Act passes.

Key Details of the Proposal

• The SEC wants to clarify how investment advisers and companies should safely hold crypto assets.
• The proposal aims to remove outdated rules that no longer fit modern security practices.
• The rule change was sent to the White House for review on August 25, 2026.
• The SEC says the update is needed to keep up with changes in how assets are traded and stored.

What Happens Next

The proposal is now under review by the White House. If approved, it could lead to new rules for how investment firms handle crypto custody. Meanwhile, the Clarity Act remains stalled in Congress, with lawmakers expected to vote on it in September.

What Is Confirmed

• The SEC has formally submitted a proposal to the White House to update crypto custody rules.
• The proposal aims to modernize regulations for investment advisers and companies.
• The Clarity Act vote has been delayed until September.

What Is Still Unclear

• Whether the White House will approve the SEC’s proposal.
• If the Clarity Act will pass when lawmakers return in September.
• How the new rules, if approved, will affect crypto investors and companies.

Why This Matters for Crypto Investors

Clearer custody rules could make it easier for investment firms to hold crypto assets safely. This might increase trust in crypto investments and encourage more companies to offer crypto-related services. However, until the proposal is approved, uncertainty remains about how the rules will change.

Sources

• Bitcoin Magazine