SEC proposes crypto custody rules with self-custody path

On Oct. 1, the SEC released a proposal governing how registered investment advisers and regulated funds must custody crypto assets. A 60-day public comment window opens after Federal Register publication — though the SEC proposal doesn’t include that publication date, so the hard deadline can’t be calculated from the available materials.

The framework permits limited self-custody and state trust companies as qualifying custodians. Chairman Paul S. Atkins said the rules and regulations “have not kept pace” and that the proposal would give advisers and funds “a compliant pathway where none existed before.”

BBTC$86,247.00▲3.24% debuted in 2008. The SEC’s own materials describe the crypto asset market as having grown from that point into a multi-trillion-dollar asset class — meaning, in this desk’s reading, the regulatory apparatus has trailed the market for roughly 18 years (2026 minus 2008).

Commissioner Peirce’s Oct. 1 statement makes the before-and-after explicit. Where the 2023 proposal was described by Peirce as making compliant custody appear impossible, the Oct. 1 proposal identifies possible custody structures — self-custody under certain circumstances and state trust companies — rather than cataloguing why structures can’t work.

Her statement also gets at a structural problem the proposal hasn’t fully solved. The existing permitted-custodian framework relies on permitted custodians, and few traditional custodians have meaningfully served a broad range of crypto assets. Peirce’s statement flags the limited availability of traditional custodians for crypto as an unresolved concern under the new framework.

Scope matters here. According to Peirce’s statement, the proposal covers only crypto assets that are securities or funds — or similar investments held by regulated funds. Anything outside those categories sits outside the framework entirely.

Self-custody comes with conditions, except the available materials do not specify the conditions under which self-custody is permitted, the requirements for state trust companies to qualify as permitted custodians, or the definition of “qualified custodian” for digital assets. Those gaps will determine whether the final rule is genuinely workable or just points toward one.

The questions raised above will be addressed during the 60-day comment period. Advisers and funds may gain additional custody options once the rule is finalized, but entities relying on digital-asset custody services first need to determine whether they can satisfy requirements the available materials do not yet specify.

CNBC’s report noted Bitcoin had rebounded more than 40% from its July 2026 low alongside coverage of the proposal. ViaBTC chief analyst Jeff Ko described it as part of a pattern of the SEC using existing authority to address bottlenecks “one by one,” with custody now in that sequence.