The Securities and Exchange Commission has sent a proposed overhaul of its crypto custody rules to the White House for review, a procedural step toward letting investment advisers and funds hold digital assets for clients under updated guidance.
The proposal, titled “Amendments to the Custody Rules,” landed at the Office of Information and Regulatory Affairs on Aug. 25, per a Reginfo.gov entry listing the rulemaking under RIN 3235-AN46. OIRA vets federal regulations before publication and is the last checkpoint before the commission votes on whether to release a rule for public comment. The text is not yet public.
The amendments would update custody requirements under both the Investment Advisers Act and the Investment Company Act. Those two statutes govern how advisers and registered funds hold client assets, The Block reported. In practice, the rules covering which assets advisers can hold and how would be rewritten to explicitly address crypto rather than leaving firms to interpret guidance built around traditional securities.
The SEC said it received questions from investment advisers about how they can hold crypto assets for clients while staying within its requirements. “This rulemaking would clarify the framework for the custody of crypto assets for investment adviser and investment companies, as well as make other modernizations needed to remove burdens from certain outdated provisions that are no longer needed to provide investor protection given the evolution in the markets and security trading and holding practices,” the agency said in a statement quoted by The Block.
That last clause carries weight. By framing older provisions as “no longer needed,” the SEC signals it plans to trim custody obligations it now considers excessive. Not simply layer on new crypto-specific language.
The filing marks the latest in a string of crypto rulemaking under Chair Paul Atkins. He took the post in 2025 and pledged to end the SEC’s prior “regulation through enforcement” approach, Cointelegraph reported. The agency dropped its lawsuit against Coinbase that year. Last week the SEC put forth “Regulation Crypto Assets,” a “tailored offering regime” it says will help firms raise capital while protecting investors. In March, the SEC and the CFTC issued joint guidance on how federal securities laws apply to digital assets, and the SEC has separately clarified that memecoins are not securities and outlined which staking activities fall outside securities law.
Atkins has also said he plans an “innovation exemption” framework to fast-track tokenized securities on decentralized platforms. That plan has yet to materialize.
The custody proposal advances while the CLARITY Act sits stalled in the Senate. The market-structure bill would set the SEC-CFTC dividing line for digital assets and is expected to face a cloture vote after the August recess in September, according to Cointelegraph. Bloomberg, which first reported the submission, framed the proposal as part of a broader push to advance the administration’s digital asset agenda as the legislation idles.
The contrast sits at the center of the story. The SEC is building out a custody-and-offering regime through agency rulemaking whether or not Congress moves the CLARITY Act this fall. Bitcoin Magazine similarly cast the filing as regulators pushing ahead while the legislative track has stalled.
OIRA can request changes before sending the proposal back. The SEC would then vote on whether to release it for public comment, with a comment period typically opening after the rule appears in the Federal Register. Neither the White House nor the SEC has said when that vote might come.
