David Edwards
The U.S. Securities and Exchange Commission (SEC) will convene its second crypto policy roundtable on Friday, with a concentrated focus on the evolving landscape of crypto asset custody and related regulatory shortfalls. This session marks the latest installment in a four-part series spearheaded by the SEC’s Crypto Task Force, established to solicit expert input and chart a cohesive policy direction for digital asset oversight.
Newly appointed SEC Chairman Paul S. Atkins, who was sworn in earlier this week, will deliver opening remarks. Atkins has signaled a commitment to providing regulatory clarity for digital assets—a move eagerly awaited by an industry grappling with compliance ambiguity.
The roundtable will include two panel discussions: “Custody Through Broker-Dealers and Beyond” and “Investment Adviser and Investment Company Custody.” These panels aim to dissect the challenges of safeguarding crypto assets under existing financial regulations, which typically require investment advisers to custody client holdings with qualified custodians—namely banks or broker-dealers.
However, the rapid innovation and 24/7 operational model of the crypto sector present significant hurdles. Traditional custodians are often ill-equipped to handle digital asset requirements, prompting calls for updated frameworks.
A 2023 SEC proposal sought to modernize custody rules but was criticized for offering limited practical solutions for crypto-native firms. Many in the industry argue that the proposed guidelines fail to acknowledge the operational realities of digital finance.
The roundtable will feature input from industry leaders such as Fireblocks, Anchorage Digital Bank, Fidelity Digital Assets, Kraken, and BitGo. Legal experts and academics are also slated to participate, several of whom have previously voiced concern over the lack of regulatory coherence.
Neel Maitra, a partner at Dechert LLP, has characterized custody as “the single greatest question facing crypto market participants,” pointing to the dual demands for investor access and secure storage. Similarly, Justin Browder of Simpson Thacher has criticized the SEC’s current stance, noting the scarcity of qualified custodians capable of supporting crypto asset storage without forcing advisers into regulatory compromises.
