SEC proposes crypto-asset custody rules for advisers and regulated funds

On 1 October 2026 the United States Securities and Exchange Commission (SEC) proposed new rules on the custody of crypto assets by registered investment advisers and regulated funds. The text, 760 pages long, is a proposal open for comment: it is not yet a rule in force.

What the proposal contains

According to the summary by the law firm Paul Hastings, the proposal changes the rules for advisers and funds in several ways:

• it allows advisers and funds to self-custody crypto assets under numerous conditions; among them, the adviser must determine, before proceeding and then every quarter, that a permitted custodian is not available;
• it allows client or fund crypto assets to be held with a state trust company, in certain circumstances;
• it updates the existing custody rules to reflect current industry practice;
• it revises recordkeeping and disclosure obligations, with new questions in Form ADV and Form N-CEN on crypto-asset custody and tokenised fund shares.

New checks are foreseen for advisers and funds that rely on a state trust company: verifying its authority to custody crypto assets, reviewing its internal procedures, its audited annual financial statements and its internal-control reports.

Positions within the SEC

Chairman Paul Atkins described the proposal as another element of a comprehensive regulatory approach to crypto assets. Commissioner Hester Peirce highlighted the new self-custody option in limited circumstances, while noting that the term is used differently from true self-custody by investors. Commissioner Mark Uyeda said that segregating paper certificates in a vault and assets recorded on a distributed ledger cannot look the same, even if the principle is identical, and that it was time for a "fresh look".

Institutional context

On 2 October Peirce left the SEC, where she had led the crypto task force. The Commission now has two members, Atkins and Uyeda, and the summary notes that the White House has not named a successor or nominees for the other two vacant seats. Comments on the proposal can be submitted within 60 days of publication in the Federal Register.

Why it matters to Swiss readers

The proposal concerns entities supervised by the SEC and does not apply to Swiss companies. It remains a useful reference for three reasons. First, custody is a central theme of every crypto regime, in Europe and Switzerland too. Second, the text shows how a regulator can distinguish between self-custody and custody entrusted to third parties, with written verification conditions. Third, anyone working with American partners, for example funds or managers, may face new requirements on the custody of their digital assets.

For an SME with no exposure to US funds or advisers, nothing changes in the short term. The methodological lesson is clear, though: whoever holds digital assets, for themselves or for others, must be able to document who controls them, with which controls and with what review.

Sources

• Paul Hastings, SEC Proposes Crypto Custody Framework, Treasury Issues Interim Final Rule on State Stablecoin Certifications, CFTC Submits Two Rules to the White House, 5 October 2026: https://www.paulhastings.com/insights/crypto-policy-tracker/sec-proposes-crypto-custody-framework-treasury-issues-interim-final-rule-on-state-stablecoin-certifications-cftc-submits-two-rules-to-the-white-house

Information, not advice. The content of the proposal is taken from the cited summary.