SEC Proposed New Crypto Asset Custody Framework

The proposed rules aim to help investment advisers and funds legally manage crypto assets for their clients.

Updated on Oct. 1, 2026 in Investing

Isometric editorial illustration of a heavy geometric vault opening to reveal a structured digital cube, representing SEC custody regulations. — The Securities and Exchange Commission proposed new rules on Wednesday aimed at streamlining how investment advisers and regulated funds hold and manage digital assets. AI Illustration. Upload story photo >

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The Securities and Exchange Commission has proposed a new regulatory framework to govern how crypto assets are held by investment advisers and regulated funds. This shift intends to bridge the gap between traditional custody rules and the realities of digital assets.

Why it matters

Current custody rules were designed for traditional investments, creating friction that can make it take months for new crypto assets to become available through financial intermediaries. These changes are intended to provide a clear path for compliant crypto asset storage.

The proposal updates rules under the Investment Advisers Act and Investment Company Act of 1940 to include crypto assets. The exact impact on management fees and custody service availability for individual investors remains to be seen.

The players

Securities and Exchange Commission

The federal agency that enforces financial regulations to protect investors and ensure fair market operations.

Paul Atkins

The current Chair of the Securities and Exchange Commission overseeing market regulation and policy updates.

The details

The SEC framework aims to modernize custody rules that were originally written for traditional financial instruments. By updating the standards under the Investment Advisers Act and the Investment Company Act of 1940, the proposal seeks to create a compliant mechanism for advisors to hold digital assets. This process is expected to streamline how crypto products are integrated into regulated portfolios.

October 1, 2026: SEC Chair Paul Atkins announced the proposal.

Money Landscape

This development marks a shift in how legacy financial regulations apply to digital asset classes. It follows a multi-year period of regulatory uncertainty regarding the custody of crypto assets within the established Investment Advisers Act of 1940 framework.

If you hold crypto through an investment adviser or regulated fund, this proposal may eventually provide more secure and accessible custody options for your assets. Consult with your financial professional to understand how your specific account holdings are currently custodied and whether future policy changes might affect your service access.

The takeaway

The SEC is working to align its 1940-era custody rules with the technological requirements of digital assets. Monitor future rule-making announcements to see if these changes affect the crypto offerings available through your brokerage or advisory firm.