SEC signals more crypto proposals after custody rule overhaul

The SEC wants the crypto industry to know it is not finished yet. Alongside a proposed rewrite of how investment advisers and funds hold digital assets, SEC Chair Paul S. Atkins said that “more regulatory proposals are on the horizon.” The latest proposal tackles one of the least glamorous but most important questions in finance: who gets to hold the assets, and how. What the custody proposal actually does On October 1, 2026, the SEC proposed a new framework for crypto custody. It covers registered investment advisers, investment companies, and business development companies. The proposal aims to fix custody requirements that, by the SEC’s framing, have fallen out of date. Rules written for stocks and bonds do not map neatly onto assets that live on a blockchain. Two changes stand out. First, the framework would allow self-custody of crypto assets, but only in limited circumstances. Second, the proposal would let state trust companies serve as custodians for crypto. That would broaden the pool of entities eligible to hold assets on behalf of advisers and funds. The framework also updates recordkeeping requirements for both advisers and funds. Atkins pitched the package as a complia...