SEC to Reassess Crypto Custody Regulations

Acting Chair of the U.S. Securities and Exchange Commission (SEC), Mark Uyeda, has directed a review of the proposal to tighten cryptocurrency custody rules, reports The Block.

He noted that the rule, introduced in February 2023 under the previous U.S. administration, faced significant objections from industry representatives.

The proposal aimed to impose stricter requirements on the custody of digital assets. Specifically, registered investment advisers were required to place cryptocurrencies in accounts with qualified custodians, who must also meet certain standards.

The initiative, proposed under the leadership of Gary Gensler, would have expanded the existing custodian rule to include any assets managed by investment advisers. This raised concerns that the new requirements would further reduce the number of banks willing to engage with the industry.

With the arrival of the new U.S. administration, the SEC dropped charges against major crypto companies like Coinbase and Robinhood, and President Donald Trump signed an order to establish a task force on digital asset markets.

Earlier, CoinDesk reported that at least four SEC lawsuits against crypto firms are still ongoing, and investigations into three companies remain open.