The U.S. Securities and Exchange Commission has forwarded a proposed overhaul of its custody rules for investment advisers and investment companies to the White House for review, a step that could clarify how institutions hold crypto assets for clients while complying with federal securities laws.
The proposal was transmitted on Aug. 25 to the Office of Information and Regulatory Affairs (OIRA), which is part of the White House Office of Management and Budget (OMB). OIRA review is required before the rule can return to the SEC and potentially be released for public comment. The agency has not yet made the text of the proposed rule public.
According to the SEC’s regulatory agenda, the changes under consideration would amend existing requirements or add new ones under the Investment Advisers Act and the Investment Company Act. The scope explicitly includes guidance on how advisers and funds may hold client assets, including cryptocurrencies.
The stated aim of the draft is to reduce uncertainty about custody practices for digital assets and make clear what firms must do to remain within the SEC’s custody regime. During OIRA review, the White House can request revisions; once any such review is complete the SEC would vote on whether to publish the proposal for notice and comment.
Observers note the custody initiative fits into a broader push by the current administration to advance digital asset policy through rulemaking, even as major legislation such as the CLARITY market-structure bill remains stalled in the Senate. That bill is expected to face a cloture vote after lawmakers return from their August recess.
The custody rule draft also reflects a wider shift at the SEC under Chair Paul Atkins, who took the lead in 2025. Atkins has emphasized formal rulemaking over an enforcement-first approach, and the agency has signaled a lesser reliance on enforcement actions in favor of clearer regulatory standards. In 2025 the SEC dismissed several high-profile cases involving major crypto firms, including its lawsuit against a leading exchange, illustrating that shift in practice.
If finalized, the custody amendments could provide firms and funds more certainty about acceptable safekeeping arrangements for crypto assets and potentially shape how custodial services, audits, and disclosures are structured in the sector. Stakeholders should expect a public-comment period if the SEC votes to release the proposal after OIRA review.
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