Breaking: SEC Sends Crypto Custody Rule Changes to White House for Regulatory Review
WASHINGTON — August 26, 2026 — The Securities and Exchange Commission has sent a proposed rule change governing how registered investment advisers custody digital assets to the White House Office of Information and Regulatory Affairs (OIRA) for review, according to a report from The Block. The filing is a procedural step that typically precedes formal publication of a proposal in the Federal Register and the opening of a public comment period.
2 min read
Context
The SEC’s custody rule — Rule 206(4)-2 under the Investment Advisers Act of 1940 — requires RIAs to hold client funds and securities with a “qualified custodian,” a category built around banks, registered broker-dealers, futures commission merchants, and certain foreign financial institutions. Crypto-native custodians have never fit cleanly into that definition, leaving advisers who hold bitcoin, ether, or tokenized assets for clients without clear compliance footing.
The Commission previously proposed a sweeping “safeguarding” rule in February 2023 that would have extended custody requirements to all client assets, including crypto. That proposal drew heavy industry opposition and was never finalized. Separately, independent agencies including the SEC now route significant rulemakings through OIRA following the February 2025 executive order extending centralized regulatory review to them.
Implications
If the proposal clarifies or expands qualified custodian eligibility, it would directly affect RIAs seeking to offer digital asset exposure, state-chartered trust companies operating as crypto custodians, and broker-dealers weighing entry into the custody business. Advisers currently limiting crypto allocations to ETPs for custody reasons may gain a path to holding spot assets directly. The precise scope remains unknown until the text is published.
What’s Next
OIRA review generally runs up to 90 days. Publication of the proposing release would trigger a public comment period, after which the Commission may adopt, revise, or withdraw the rule.
Source: The Block Regulatory, August 26, 2026. Rule text not yet public; CryptoLaw.blog will update upon Federal Register publication.
This content is for informational purposes only and does not constitute legal advice. Consult with a qualified US attorney for guidance specific to your situation.
