SEC Clears Path for State Trusts to Custody Crypto Assets

The SEC has given a green signal for custody crypto assets. The government stated in a recent no-action letter that advisers are not limited to using traditional banks or federally regulated corporations as qualified custodians for digital assets, but can also employ state-chartered trust companies. The move comes as a significant milestone because one of the most challenging aspects of regulating crypto has been custody. In order to protect client assets, advisers have frequently had difficulty locating trustworthy, compliant partners. The SEC is expanding the market while maintaining investor protections by recognising state trust organisations. The action might accelerate institutional adoption in the United States by making it considerably simpler for advisors to include cryptocurrency in client portfolios.