SEC Removes Custody Rules, Potential Boost for Institutional Crypto Investments

The U.S. Securities and Exchange Commission (SEC) has removed key regulations governing the custody of crypto assets by broker-dealers, a move that could significantly expand access to cryptocurrency markets for institutional investors. The SEC’s Division of Trading and Markets issued new guidance effective May 2025, encouraging brokers to engage in crypto custody services. This shift may facilitate increased investment in crypto securities like Ethereum and Solana from traditional financial institutions. However, the ongoing uncertainty surrounding the classification of certain crypto assets as securities remains a hurdle for market clarity.