SEC Chair Atkins Wants Advisers to Self-Custody Crypto—but No Rule Exists Yet

The Securities and Exchange Commission’s chair wants agency staff to build a path for investment advisers to hold crypto directly for clients and regulated funds. That is a meaningful policy signal. It is not, however, permission to do so today.

Atkins delivered the remarks at the Solana Policy Institute Summit in Washington. He framed custody as an access problem: advisers and funds may want exposure to crypto assets for which a traditional qualified custodian is not available. His proposed answer is to widen the available routes—but only with conditions that staff have yet to write.

The distinction matters because speeches can easily outrun law in crypto markets. Atkins explicitly said the remarks reflected his own views and did not necessarily represent the SEC or his fellow commissioners. The agency’s current custody requirements remain in place.

What Atkins actually directed

Atkins said he asked SEC staff to develop a proposal that would answer two questions affirmatively under defined circumstances:

• Can a registered investment adviser self-custody crypto assets for clients or regulated funds?
• Can an adviser use a state trust company as a crypto custodian?

The chair’s published remarks do not identify which assets would qualify, who inside an adviser could control private keys, what insurance or capital standards might apply, or how auditors would verify holdings. They also do not say when staff might present a proposal to the Commission.

That makes the direction consequential but preliminary. Staff can develop recommendations; changing the regulatory framework would require formal Commission action.

Self-custody would be the larger break

The SEC’s custody rule has long required registered advisers that possess client funds or securities to maintain them with a qualified custodian, generally a bank, broker-dealer or another eligible financial institution. The SEC’s 2003 rule release describes the arrangement as a safeguard against loss, misuse and misappropriation.

Crypto complicates that model. Control of a private key can amount to practical control of an asset, while some tokens may not be supported by a custodian that fits the existing rule. Atkins is now asking staff to examine whether an adviser could perform that custody function itself.

Analysis: A workable self-custody regime would likely need to answer questions that go beyond secure key storage. Regulators may have to define segregation of client assets, recovery procedures, transaction authorization, independent verification, recordkeeping and what happens if the adviser fails. Atkins did not prescribe those answers in the speech.

State trust companies already have a conditional path

The state-trust-company part of Atkins’s direction builds on a narrower staff position already in use. On September 30, 2025, the SEC’s Division of Investment Management issued a no-action letter to Simpson Thacher & Bartlett addressing certain state-chartered trust companies.

Under the facts described in that letter, division staff said they would not recommend enforcement if an adviser or regulated fund treated a qualifying state trust company as a bank for crypto custody. The relief was conditional. It contemplated state authorization, annual due diligence, audited financial statements, internal-control reports, cybersecurity and private-key policies, asset segregation, limits on rehypothecation, risk disclosure and a best-interest determination.

A no-action letter is not a statute or SEC rule. It is a staff enforcement position tied to stated facts, and the letter itself says it has no legal force or effect. A Commission proposal could put the subject on a more durable and broadly applicable footing, but its scope could also differ from the 2025 letter.

The trust-company question is increasingly practical. Block, for example, has separately sought a federal trust-bank charter for a custody-focused institution, as Crypto Main News reported. Atkins’s remarks concern a different issue: which custodians SEC-regulated advisers and funds may use.

Nothing changes for advisers today

For compliance teams, the immediate answer is simple: the speech does not amend the custody rule. Advisers cannot treat Atkins’s preference as a new exemption, and funds do not receive a new self-custody option merely because the chair supports one.

Any adviser considering a state trust company still needs to evaluate the existing staff letter against its specific facts, current SEC requirements, fiduciary duties and applicable state law. The no-action position is not a blanket approval of every trust company.

For the market, though, the direction clarifies where the chair wants policy to go. It pairs custody reform with a broader SEC effort to adapt registration, offering and market-infrastructure rules to onchain assets. That agenda already includes a proposed disclosure framework discussed in Crypto Main News’s coverage of Regulation Crypto Assets and work to modernize transfer-agent rules for tokenized securities.

The unanswered questions will define the proposal

The eventual text—not the speech—will determine whether the proposal is a narrow accommodation or a structural change. Among the issues to watch:

• Eligible assets: whether relief applies only to assets that lack a qualified third-party custodian or to crypto more broadly.
• Control of keys: how authorization, backup, recovery and separation of duties would work inside an adviser.
• Independent checks: what audits, examinations or proof-of-control procedures would be required.
• Client protection: how assets would be segregated and treated in insolvency, theft or operational failure.
• Institutional standards: whether capital, insurance, cybersecurity or reporting thresholds would apply to advisers and trust companies.
• Transition timing: whether firms would receive a phase-in period after any final action.

Until staff publishes a document, there is no reliable basis for predicting those conditions. The chair has supplied a destination; the regulatory map is still blank.

Frequently asked questions

Can SEC-registered advisers self-custody client crypto now?

Not because of Atkins’s speech. He asked staff to develop a proposal. Current custody requirements remain in effect unless an adviser can rely on an existing rule, exemption or applicable staff position based on its own facts.

Can a state trust company serve as a crypto custodian?

SEC investment-management staff issued conditional no-action relief in 2025 for qualifying state trust companies under specified circumstances. That relief is fact-specific, is not an SEC rule and does not remove an adviser’s other legal or fiduciary obligations.

When would a new crypto custody framework take effect?

No date is available. Staff has not published proposal text, and any regulatory change would still need formal Commission action. A final framework could differ materially from the chair’s initial direction.

Reporting note: This article relies on the SEC chair’s September 14, 2026 remarks, the Division of Investment Management’s September 30, 2025 no-action letter and the SEC’s custody-rule release. Featured photo: David Trinks/Unsplash. Inline photo: Jason Pofahl/Unsplash. No affiliate links are used.