With Bitcoin and the cryptocurrency market experiencing a rapid rise in recent days, the US Securities and Exchange Commission (SEC) is preparing to revise the rules regarding how investment advisors and investment firms must hold crypto assets.
At this point, the SEC has taken a new step to update the regulatory framework for the cryptocurrency market.
According to Bloomberg, the SEC submitted its proposal to the White House Office of Management and Budget (OMB) on August 25, aiming to clarify rules regarding the custody of crypto assets held by investment advisors and investment firms.
Aiming for Clarity in Cryptocurrencies!
The regulation, listed in the SEC’s official regulatory records under the title “Amendments to the Custody Rules,” aims to modernize existing regulations regarding how investment advisors and mutual funds must safeguard their clients’ assets. It specifically seeks to address current uncertainties surrounding the custody of crypto assets.
At this point, the SEC’s proposal aims to create a clearer framework for how investment advisors and investment firms can hold crypto assets in accordance with existing SEC rules.
The proposal aims not only to introduce new rules for crypto assets but also to remove some existing custody requirements that the SEC has deemed “outdated” due to market evolution and current trading and holding practices.
First the White House, Then the SEC!
Following the White House’s OMB review, the proposal is expected to be evaluated by the SEC and then released to the public. The proposal will require a vote by SEC committee members before it can be published. After that, the regulation will be open to public comment for at least 60 days. Finally, the SEC will need to hold a final vote before the regulation goes into effect.
A Significant Step for the Crypto Market!
According to experts, this move by the SEC is important in terms of making the regulatory approach to crypto assets in the US clearer and more aligned with market conditions.
For institutional investors, particularly investment advisors and investment firms, clarity on the rules for storing crypto assets is crucial.
*This is not investment advice.
