The SEC is considering crypto recommendations for its custody rule

The Securities and Exchange Commission is considering new recommendations on crypto for investment advisers and investment companies, according to recent remarks.

William Birdthistle, Director of the Division of Investment Management, addressed the emergence of crypto in an address to the IAA Investment Adviser Compliance Conference. The division of investment management oversees rulemaking related to investment advisers. During his remarks, Birdthistle said he is considering ways to “bring order” to the crypto industry.

“For investment advisers, I am cognizant of questions about how providing advice regarding crypto assets impacts compliance with the Act, particularly aspects of the custody rule,” he said.

The custody rule, also known as the Advisers Act, requires advisers to hold a client’s securities with a designated qualified custodian. Qualified custodians are essentially banks, broker-dealers and trusts licensed on the federal or state levels. Some crypto firms have already nabbed the designation, like Coinbase’s custody service and Anchorage Digital Bank.

But in the past, it’s been unclear how the SEC views the designation on a state level. The SEC asked for public comments on qualified custodians as they relate to digital assets in the wake of Wyoming’s decision to grant a no action letter to Two Ocean, a wealth management firm facilitating crypto investing that positioned itself publicly as a qualified custodian.

The questions in that letter solicited feedback on how digital assets are held in custody and what protections are sought out by advisers when looking for a custodian.

Birdthistle said he plans to consider recommendations related to a variety of comments received on topics related to securities use on digital asset venues.

“The expanding opportunities to invest in securities directly using digital platforms, such as robo-advisers, online brokerages, and mobile investment apps and portals, also present challenges,” he said. “I look forward to considering recommendations in light of the comments we have received in this area.”

--

--

--

Supreme Finance is simply an adoption-focused DeFi protocol on which we intend to create a fully-integrated user-friendly platform/service, to connect

Love podcasts or audiobooks? Learn on the go with our new app.

Recommended from Medium

💸 Borrow Like a Billionaire: Mai Finance Zero-Interest Loans

IDO launchpad on Multiple-Chain — Establishing a new path to engage the crypto market

Announcing Torum (XTM) Listing on MEXC Global

Ling Cage Incarnation: Minting Guide

Space Invaders Tokenomics (SIP)

CARDSTACK — The experience layer of the decentralized internet

The World’s Largest Bank has Entered the Metaverse

AOFEX Establishes Its Canada Branch Officially to Accelerate Globalization

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Supreme Finance

Supreme Finance

Supreme Finance is simply an adoption-focused DeFi protocol on which we intend to create a fully-integrated user-friendly platform/service, to connect

More from Medium

Maytag Virgin

I fell in love with a war

The blade specialist|Angel Buchkov

Shein, fashion 2.0’s black sheep?

https://www.linkedin.com/in/ruzureau/ sustainable fashion expert on fast fashion success story Shein