SEC Sends Crypto Custody Rule Overhaul to White House for Review

The U.S. Securities and Exchange Commission (SEC) has forwarded a draft amendment to its custody rules to the White House Office of Information and Regulatory Affairs (OIRA) for review. The proposal targets investment advisers and investment companies, aiming to provide clearer guidance on how these entities may hold crypto assets for clients while complying with federal securities laws.

Regulatory Process

The amendment, titled “Amendments to the Custody Rules,” was sent on August 25 to OIRA, part of the White House Office of Management and Budget. OIRA may request changes before returning the draft to the SEC, after which the commission will decide whether to open the rule for public comment.

Scope of the Changes

The SEC’s agenda indicates that the rule could modify existing provisions or introduce new requirements under the Investment Advisers Act and the Investment Company Act. The focus is on how investment advisers and funds safeguard client assets, including digital assets such as cryptocurrencies.

Policy Context

The move aligns with the SEC’s broader shift toward rulemaking rather than enforcement‑focused regulation of digital assets. Since Paul Atkins became chair in 2025, the agency has emphasized formal rulemaking to reduce uncertainty for market participants. The proposal is also part of a larger effort to advance the administration’s digital‑asset agenda, which includes the stalled CLARITY market‑structure bill.

Next Steps

After OIRA’s review, the SEC will vote on releasing the draft for public comment. Stakeholders will then have an opportunity to provide feedback before any final rule is adopted.