🚨 Crypto Custody Is Moving Closer to Wall Street
The SEC has proposed a new custody framework that could give registered investment advisers and regulated funds a clearer way to handle crypto assets under federal securities rules.
At first glance, custody rules may sound like pure paperwork.
But this is one of the areas that matters most for institutional crypto adoption.
Traditional financial firms need clear answers before they can comfortably hold digital assets:
• Who has custody of the assets?
• How are client assets separated?
• What security and operational controls are required?
• Who is responsible if something goes wrong?
The proposed framework aims to address those questions for assets recorded on distributed ledgers while maintaining safeguards around custody and asset segregation.
And that's the bigger development.
The conversation around crypto is increasingly moving beyond “Should institutions hold it?”
It's becoming:
“What rules and infrastructure should institutions use to hold it?”
That shift could matter for investment funds, advisers, custodians and other financial institutions as the regulatory framework develops.
The next stage of crypto adoption may not always look exciting.
Sometimes it looks like better custody, clearer rules and traditional financial infrastructure catching up with digital assets. 👀
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