SEC sends crypto custody rule changes to White House for review

A proposal from the U.S. Securities and Exchange Commission to change its rules governing how investment advisers hold digital assets was sent this week to the White House for review.According to its website, the Office of Information and Regulatory Affairs, a division of the Office of Management and Budget that reviews federal regulations before publication, is reviewing changes to the SEC’s custody rules. The SEC said it received questions from investment advisers about how they can hold crypto assets for clients while complying with 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investment adviser and investment companies, as well as make other modernizations needed to remove burdens from certain outdated provisions that are no longer needed to provide investor protection given the evolution in the markets and security trading and holding practices," the SEC said.Bloomberg earlier reported the news.Over the past year, the SEC, under its crypto-friendly Chair Paul Atkins, has embarked on a regulatory shakeup for digital assets. The agency has released guidance clarifying its stance that memecoins are not securities, as well as what staking activities would fall outside of securities law.Last week, the SEC took a step further and put forth "Regulation Crypto Assets," which it says would be a "tailored offering regime" designed to help raise capital while protecting investors. Reg Crypto builds on guidance released in March by both the SEC and its sister agency, the Commodity Futures Trading Commission, that clarified how federal securities laws apply to digital assets and transactions.Still, there is anticipation surrounding an innovation exemption. Atkins has said he plans to introduce a framework to fast-track crypto products, but that plan has yet to come to fruition. The exemption would provide regulatory relief to firms seeking to issue tokenized securities on decentralized or other novel platforms.Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.© 2026 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.