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first_img U.S. SEC Chairman: Plans to Establish a Framework for Cryptocurrency Asset Custody

The Chairman of the U.S. Securities and Exchange Commission (SEC), Paul Atkins, issued a statement saying that the Commission proposed a plan this week to fill the regulatory gap regarding the custody of cryptocurrency assets by investment advisors and funds, providing a clear custody framework and compliance path for an asset class with increasing client demand.Atkins stated that the existing custody rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 were established before the advent of the internet, primarily targeting traditional assets and requiring the use of approved custodians. The custody capabilities for new cryptocurrency assets often lag behind the launch of the assets by several months. This proposal aims to address this issue while updating the custody rules for advisors and regulated funds that have not been revised for decades to align with current industry practices and feedback.The statement noted that this proposal is part of the SEC's regulatory framework for cryptocurrency assets. Related efforts include stopping the replacement of regulation with enforcement, issuing a no-action letter regarding the pilot program for the tokenization of securities by custodial trust companies by December 2025, publishing a classification description for tokenized securities in January 2026, and subsequent initiatives regarding the securities attributes of cryptocurrency assets, broker registration, Regulation Crypto Assets, and innovative exemptions for trading tokenized NMS stocks. Atkins indicated that more regulatory proposals will be forthcoming.

first_img The Bank of America group sued the OCC, accusing it of overstepping its authority by issuing trust licenses to cryptocurrency companies

The Independent Community Bankers of America (ICBA) filed a lawsuit against the Office of the Comptroller of the Currency (OCC) in federal court on Friday, accusing it of exceeding its statutory authority when issuing national trust bank charters to cryptocurrency companies. The ICBA stated that the OCC is implementing "broad new powers not authorized by the National Bank Act," allowing these companies to enter the U.S. banking system without being subject to the same level of regulatory oversight as community banks, putting small banks at a "serious competitive disadvantage."The ICBA is one of the largest banking advocacy organizations in the United States, primarily representing small institutions. Last month, the organization strongly opposed the Digital Asset Market Structure Bill, which failed to advance in the U.S. Senate, arguing that its stablecoin provisions did not protect community banks from direct competition for deposit accounts. ICBA President and CEO Rebeca Romero Rainey stated that Congress did not establish the national trust charter to provide a "backdoor" for cryptocurrency companies seeking to enter the banking system with the credibility of a federal bank charter, as these companies do not bear the same obligations regarding capital, liquidity, regulation, and Federal Deposit Insurance Corporation (FDIC) insurance requirements. An OCC spokesperson responded to CoinDesk that the agency does not comment on ongoing litigation.Recently, the OCC has continued to issue trust charters to cryptocurrency companies, but these companies' business models differ from those of typical community banks and do not offer cash deposit accounts that require FDIC insurance. Approved institutions include cryptocurrency banks Protego and Erebor, as well as existing cryptocurrency firms like Coinbase, Circle, and Crypto.com.
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