U.S. regulator moves to ease crypto holdings for funds and advisers

• The proposal modernizes decades-old custody requirements and removes regulatory barriers that previously limited advisers' ability to offer crypto investments to clients
• SEC Chairman Paul Atkins stated the changes provide 'a clear regulatory framework for the custody of crypto assets, giving investment advisers and funds a compliant pathway where none existed before'
• The proposal is open for 60-day public comment after Federal Register publication and represents part of the SEC's broader effort to establish a crypto rulebook under existing authority

Summary

The U.S. Securities and Exchange Commission (SEC) has proposed new rules to facilitate cryptocurrency holdings for investment advisers and regulated funds. Announced Thursday, the framework would modernize decades-old custody requirements that have limited advisers' ability to offer crypto-related investments.

Key Provisions:

• Allows self-custody of crypto assets under certain circumstances
• Permits state trust companies to serve as custodians for client and fund crypto assets
• Provides registered investment advisers, investment companies, and business development companies with compliant pathways for holding digital assets

Regulatory Context:

The proposal comes after the Clarity Act—a comprehensive crypto market structure bill—stalled in the Senate. U.S. regulators are now building a crypto rulebook under existing authority rather than waiting for legislative action. SEC Chairman Paul Atkins emphasized that current regulations haven't kept pace with digital assets, which have evolved into a multi-trillion-dollar market.

Market Implications:

The changes could enable regulated funds to offer expanded crypto-related investment strategies to investors, potentially opening institutional access to digital assets. This represents a significant shift in the SEC's approach under Atkins' leadership toward establishing clearer regulatory frameworks for cryptocurrency.

Timeline:

The proposal will be open for 60-day public comment after publication in the Federal Register.

Market Environment:

The announcement coincides with renewed momentum in crypto markets following a volatile period. Bitcoin has recovered from a prolonged downturn spanning late 2025 through the first half of 2026, supported by improving risk appetite driving renewed demand for digital assets.