SEC Proposes Two New Crypto Custody Routes for Advisers and Funds, Three Outlets Confirm

Source basis: The core of this story appears in three independent reports, from Cointelegraph, The Block and Decrypt. All three agree on two points: the proposal allows conditional self-custody and admits state trust companies as custodians. Quotes and procedural details below come from a single outlet and are attributed as such.

The US Securities and Exchange Commission has proposed rules that would give registered investment advisers and funds two new ways to hold crypto for clients. Advisers could keep client tokens themselves when no eligible crypto custodian is available, subject to conditions. State trust companies would also qualify as crypto custodians. Cointelegraph reported that the proposal was published on Thursday.

The market was firm when the news landed. Price tickers on two of the outlets showed Bitcoin at about $86,596 and $86,561, up roughly 2.8% to 2.9% on the day, with Ether near $2,735. Those are aggregated snapshots taken at slightly different moments, which accounts for the small gap. Nothing in the reporting ties the move to the SEC announcement.

What All Three Reports Agree On

The proposal addresses a practical bottleneck. An adviser who wants to put a client into a particular token first needs a custodian that meets regulatory requirements for that asset. For many tokens no such custodian has existed, and so the investment simply could not be offered.

Decrypt framed the package as an effort to replace years of ambiguity with a defined compliance path. The Block described the same two mechanisms: limited self-custody, and state trust companies as eligible custodians. The SEC’s earlier posture effectively narrowed the field of acceptable custodians. Allowing state-chartered trust companies widens that pool.

Single-Sourced Details: Safeguards and Statements

The mechanics of self-custody come from Cointelegraph alone. According to that outlet, an adviser would have to show that no permitted custodian exists for each specific asset. It would then repeat that check every quarter. If a qualifying custodian later appears, the adviser would need to move the assets “as soon as reasonably practicable.”

Cointelegraph also carried a statement from SEC Chair Paul Atkins, who said crypto has grown into “a multi-trillion-dollar asset class” and that “our rules and regulations have not kept pace.” Commissioner Hester Peirce, in a separate statement quoted by the same outlet, compared the uncertainty to a regulatory “roller coaster.”

The outlet further cited a May 2025 submission from the Digital Chamber. That filing said some advisers had turned down token allocations or asked portfolio companies to hold the tokens until custody became available. We could not match this detail in the other two reports.

Read more: SEC’s Hester Peirce Confirms Oct. 2 Exit, Two Outlets Verify Resignation Letter

Who Feels the Change First

The first-order effect falls on wealth managers and fund sponsors. Many have avoided smaller or newer tokens because they had nowhere compliant to store them. A conditional self-custody route, combined with more custodian options, could widen the range of digital assets that advisers are able to put in client portfolios. That depends on the final text.

For token holders, the channel is indirect. Advised money tends to move slowly and in size. Any added demand would arrive through allocation decisions made over months, not trading sessions. Custody providers chartered as state trust companies stand to gain a clearer role as eligible custodians.

One caution applies. This is a proposal, not a final rule. None of the three reports specified a comment deadline or an effective date, so the timeline to implementation is still unconfirmed. Advisers’ existing obligations continue until the SEC votes on a finished version, with the quarterly-check design as the detail most worth watching in that text.

Sources

• cointelegraph.com
• theblock.co
• decrypt.co