The U.S. Securities and Exchange Commission (SEC) (SEC) is considering withdrawing a proposal to tighten cryptocurrency custody requirements, marking the latest move by SEC Chairman Mark Uyeda under the Trump administration.
Mr. Uyeda said that many contributions have expressed significant concerns about the proposed rules in February 2023, requiring registered investment advisers to store digital asset securities at a qualified custodian and adhere to strict criteria.
"In light of these concerns, continuing to implement the initial proposal may be highly challenging," Uyeda said Monday at the (Investment Company Institute) Institute of Investment Management 2025 conference in San Diego. "Therefore, I have asked SEC personnel to work closely with the crypto task force to consider suitable alternatives."
Uyeda's speech mainly focuses on the SEC rulemaking process, including the ability to withdraw, repropose, or delay the compliance timeframe for new regulations.
The custody rules proposed under the Biden administration, with Gary Gensler leading the SEC, aim to expand the current custody regulations to include all client assets that investment advisers hold, while adding additional protective measures for those assets.
According to current regulations, investment advisors must store client assets at a custodian entity with sufficient standards, such as a bank or brokerage firm. The new rules will expand these standards to the cryptocurrency field, raising concerns about banks potentially limiting services to this sector.
When the regulations were proposed, many Republican lawmakers, cryptocurrency companies, and traditional financial organizations spoke out against it. A coalition of banking and financial associations, including the American Bankers Association, warned that this regulation "could have a significant impact on their business operations."
The reconsideration of Ueda's custody regulations marks the second time this month that the SEC Chairman's office has requested personnel to reassess existing rules. Last week, he also directed a review of a proposed amendment to the definition of 'exchange,' which could impact decentralized cryptocurrency projects.
Both of these actions indicate a shift in the SEC's policy orientation under the Trump administration. Previously, under the Biden administration, former chairman Gensler asserted that most cryptocurrencies, excluding Bitcoin, are securities.
Since the Trump administration took over, the SEC has quickly changed its stance on cryptocurrencies. In recent weeks, the agency has withdrawn controversial accounting guidance on cryptocurrencies, scrapped enforcement actions against multiple companies in the industry, established a cryptocurrency working group, and made statements on memecoins. This working group will hold its first roundtable on Friday to discuss the “securities definition for digital assets.”
Disclaimer:The article is for informational purposes only, not investment advice. Investors should carefully research before making decisions. We are not responsible for your investment decisions.
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SEC considers withdrawing proposal to tighten regulations on cryptocurrency custody
Mr. Uyeda said that many contributions have expressed significant concerns about the proposed rules in February 2023, requiring registered investment advisers to store digital asset securities at a qualified custodian and adhere to strict criteria.
"In light of these concerns, continuing to implement the initial proposal may be highly challenging," Uyeda said Monday at the (Investment Company Institute) Institute of Investment Management 2025 conference in San Diego. "Therefore, I have asked SEC personnel to work closely with the crypto task force to consider suitable alternatives."
Uyeda's speech mainly focuses on the SEC rulemaking process, including the ability to withdraw, repropose, or delay the compliance timeframe for new regulations.
The custody rules proposed under the Biden administration, with Gary Gensler leading the SEC, aim to expand the current custody regulations to include all client assets that investment advisers hold, while adding additional protective measures for those assets.
According to current regulations, investment advisors must store client assets at a custodian entity with sufficient standards, such as a bank or brokerage firm. The new rules will expand these standards to the cryptocurrency field, raising concerns about banks potentially limiting services to this sector.
When the regulations were proposed, many Republican lawmakers, cryptocurrency companies, and traditional financial organizations spoke out against it. A coalition of banking and financial associations, including the American Bankers Association, warned that this regulation "could have a significant impact on their business operations."
The reconsideration of Ueda's custody regulations marks the second time this month that the SEC Chairman's office has requested personnel to reassess existing rules. Last week, he also directed a review of a proposed amendment to the definition of 'exchange,' which could impact decentralized cryptocurrency projects.
Both of these actions indicate a shift in the SEC's policy orientation under the Trump administration. Previously, under the Biden administration, former chairman Gensler asserted that most cryptocurrencies, excluding Bitcoin, are securities.
Since the Trump administration took over, the SEC has quickly changed its stance on cryptocurrencies. In recent weeks, the agency has withdrawn controversial accounting guidance on cryptocurrencies, scrapped enforcement actions against multiple companies in the industry, established a cryptocurrency working group, and made statements on memecoins. This working group will hold its first roundtable on Friday to discuss the “securities definition for digital assets.”
Disclaimer: The article is for informational purposes only, not investment advice. Investors should carefully research before making decisions. We are not responsible for your investment decisions.
Thạch Sanh
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