Overview
- The SEC transmitted a standalone, economically significant proposal on crypto custody to the White House Office of Management and Budget on Aug. 25, 2026, and the full text has not yet been made public.
- Once OMB completes its review the proposal must return to the SEC for a three-commissioner vote before the agency can publish the rule for a public comment period and then prepare a final rule.
- The draft would update how registered investment advisers and investment companies hold crypto by clarifying custody rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 and by removing provisions the agency views as outdated.
- The rule is a fresh effort under SEC Chair Paul Atkins and is deliberately separate from the withdrawn 2023 safeguarding proposal, reflecting Atkins’s shift toward formal rulemaking rather than enforcement actions.
- The proposal sits alongside ongoing congressional talks over the CLARITY Act and CFTC rulemaking, and it could change which institutions advisers can use to safeguard private keys and tokens while some jurisdictional issues will still require new legislation.