The US Securities and Exchange Commission (SEC) is moving forward with plans to overhaul custody rules for investment advisers and investment companies, potentially giving institutions greater clarity on how they can hold crypto assets for clients while complying with federal securities rules.

The proposed rule was sent on Aug. 25 to the Office of Information and Regulatory Affairs (OIRA), part of the White House Office of Management and Budget, for review before it can return to the SEC and potentially be released for public comment.

SEC submits “Amendments to the Custody Rules” to OIRA. Source: Reginfo.gov

According to the SEC’s regulatory agenda, the agency is considering changes to existing rules or the introduction of new ones under the Investment Advisers Act and the Investment Company Act. The changes would affect how investment advisers and funds hold client assets, including crypto.

The regulator said the revisions are intended to remove uncertainty around how firms can custody crypto for clients while remaining in compliance with its rules. For advisers and funds, custody has long been a practical compliance issue because rules written for traditional securities have not always mapped neatly onto digital assets. The proposal has not yet been made public, and the White House Office of Management and Budget may request revisions before sending it back to the SEC. The commission would then vote on whether to publish it for public comment.

As Bloomberg reported, the proposed rule is part of the agency’s broader effort to advance the Trump administration’s digital asset agenda while the CLARITY market structure bill remains stalled in the Senate. The bill is expected to face a cloture vote after lawmakers return from the August recess in September.

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SEC shifts from crypto enforcement to rulemaking

Since Paul Atkins became chair in 2025, the SEC has taken a more crypto-friendly approach, shifting its focus from enforcement actions toward creating clearer rules for the industry. Atkins has said he wants to end the agency’s previous “regulation through enforcement” approach and replace it with formal rulemaking.

That shift has also been reflected in enforcement. In 2025, the SEC dismissed several cases against major crypto companies, including its lawsuit against Coinbase, as it moved to reshape its approach to digital assets. For market participants, the custody review is another sign that the agency is trying to define the operational rules around crypto rather than relying primarily on case-by-case disputes.

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