Summary: Key Takeaways
- The SEC will host the second roundtable of its four-part series on April 25, focusing on crypto custody rules.
- The roundtable will feature industry leaders from firms like Fireblocks, Anchorage Digital Bank, Fidelity Digital Assets, Kraken, and BitGo.
- The session includes two panel discussions: “Custody Through Broker-Dealers and Beyond” and “Investment Adviser and Investment Company Custody.”
- SEC Chair Paul S. Atkins and other officials aim to clarify outdated custody regulations.
- Industry experts argue that current SEC rules don’t reflect the technical and operational needs of digital assets.
A Crucial Debate for the Future of Crypto Custody
The U.S. Securities and Exchange Commission (SEC) is set to hold the second session in its ongoing crypto policy roundtable series on Friday, April 25. The focus this time? Custody rules for crypto assets—a highly debated and unresolved issue in the world of digital finance.
This event, part of a four-part series initiated by the SEC’s Crypto Task Force, seeks to address long-standing regulatory uncertainties. Each roundtable is designed to foster direct dialogue between regulators, legal experts, and industry insiders on critical crypto policy areas.
Leadership with a New Tone
Kicking off the session will be newly sworn-in SEC Chair Paul S. Atkins. His leadership marks a shift toward greater regulatory clarity and industry collaboration. Speaking about the SEC’s broader mission, Atkins affirmed, “My time in public service and in the private sector has taught me the value of clear, workable rules that support innovation while protecting investors.”
Commissioner Hester Peirce, who leads the Crypto Task Force, added that these roundtables are designed to “hear a lively discussion among experts” and to identify practical steps the SEC can take to resolve complex regulatory issues.
Custody: The “Single Greatest Question” in Crypto
Custody of digital assets remains one of the most pressing challenges in the crypto space. Under existing SEC rules, investment advisers must store client assets with qualified custodians such as banks or broker-dealers. However, few such custodians are technically equipped to manage crypto assets, which require 24/7 systems and blockchain-specific infrastructure.
Neel Maitra, partner at Dechert LLP, captured the urgency of the issue by calling custody “the single greatest question facing crypto market participants,” as it directly impacts investor trust and compliance.
Similarly, Justin Browder of Simpson Thacher noted the regulatory dilemma advisers face: “There are currently very few qualified custodians that are capable of providing solutions for crypto-assets.” He criticized the SEC’s previous approach for making advisers choose between fulfilling client needs and meeting compliance standards.
What to Expect at the Roundtable
Friday’s session will feature two focused panels:
- Custody Through Broker-Dealers and Beyond: Exploring how brokerage models adapt to the demands of digital asset security.
- Investment Adviser and Investment Company Custody: Addressing the regulatory burdens for firms managing crypto on behalf of clients.
Representatives from top crypto custodians and financial institutions, including Fireblocks, Fidelity Digital Assets, and Anchorage Digital, will join legal scholars to offer insights and challenge outdated frameworks.
Looking Ahead
Following this roundtable, the SEC has two more sessions scheduled: one on tokenization (May 12) and another on decentralized finance (June 6). These events will continue shaping the regulatory roadmap for a sector still in its formative years.
As regulatory scrutiny intensifies, this series may determine how effectively the U.S. adapts to the rapidly evolving crypto landscape. The custody session is not just about compliance—it’s about setting the foundation for the future of digital finance.