Key Takeaways
- • The SEC proposed Crypto Custody Rules setting requirements for registered investment advisers holding client crypto assets and for regulated investment companies custodying crypto-related assets, with public comments open until December 7, 2026.
- • On October 23, the SEC named tokenized securities as an examination priority for Wall Street firms during fiscal 2027, alongside artificial intelligence and private assets.
- • The SEC's September Innovation Exemption allows certain Tokenized Securities Venues to facilitate blockchain-based trading of stocks under temporary regulatory relief, which SEC Chair Paul Atkins described as a bridge toward longer-term onchain rules.
- • The proposed Regulation Crypto Assets would create two offering exemptions: up to $5 million over four years, and up to $75 million over 12 months subject to added disclosure, plus a conditional safe harbor.
- • At least 22 companies have objected to having their shares tokenized through a planned OKX and Intercontinental Exchange-backed platform, according to regulatory documents reported by Reuters.
Summary
The Securities and Exchange Commission is moving US crypto regulation into a more detailed phase, focusing on custody, tokenized securities and rules for digital-asset issuers. The agency recently proposed new Crypto Custody Rules that would govern how registered investment advisers hold client crypto funds and securities, and how regulated investment companies custody crypto-related assets. The proposal also updates reporting and recordkeeping requirements. Public comments are open until December 7, 2026. The rules reflect the growing institutional question of how crypto assets must be protected, recorded and controlled, as banks, asset managers and investment firms expand their exposure.
Tokenization is another priority. On October 23, the SEC said tokenized securities will be among the areas examined when regulators review Wall Street firms during fiscal 2027. The agency will assess risks created by changing market structures as stocks and other traditional securities move onto blockchain infrastructure, with artificial intelligence and private assets also receiving heightened scrutiny. The focus follows the SEC's September introduction of an Innovation Exemption, which allows certain Tokenized Securities Venues to facilitate blockchain-based trading of stocks under temporary regulatory relief. SEC Chair Paul Atkins described the measure as a bridge toward longer-term rules for bringing US capital markets onchain. Resistance remains: at least 22 companies have objected to having their shares tokenized through a planned platform backed by OKX and Intercontinental Exchange, according to regulatory documents reported by Reuters.
On issuance, the SEC is considering a broader proposal called Regulation Crypto Assets. It would create two new exemptions for certain crypto-related investment-contract offerings: one for offerings of up to $5 million over four years, and a second for offerings of up to $75 million during a 12-month period, subject to additional disclosure and reporting requirements. A conditional safe harbor could allow qualifying crypto assets to fall outside the definition of an investment contract, potentially giving issuers a clearer route to raise capital in the US rather than structuring projects offshore.
The framework builds on formal guidance issued earlier this year clarifying how federal securities laws apply to crypto. The SEC stated that a crypto asset may not itself be a security, but its sale can fall under securities law if offered through an investment contract. The agency continues to apply principles derived from the Howey test, including whether investors expect profits based on the managerial efforts of others. The article notes that regulatory treatment can depend on how an asset is marketed and sold rather than only on the underlying technology.
The article characterizes these measures as a shift away from broad uncertainty toward detailed rules, with the central question moving from whether digital assets will be regulated to what permanent rules will look like as crypto integrates with traditional finance.
Tokenization is another priority. On October 23, the SEC said tokenized securities will be among the areas examined when regulators review Wall Street firms during fiscal 2027. The agency will assess risks created by changing market structures as stocks and other traditional securities move onto blockchain infrastructure, with artificial intelligence and private assets also receiving heightened scrutiny. The focus follows the SEC's September introduction of an Innovation Exemption, which allows certain Tokenized Securities Venues to facilitate blockchain-based trading of stocks under temporary regulatory relief. SEC Chair Paul Atkins described the measure as a bridge toward longer-term rules for bringing US capital markets onchain. Resistance remains: at least 22 companies have objected to having their shares tokenized through a planned platform backed by OKX and Intercontinental Exchange, according to regulatory documents reported by Reuters.
On issuance, the SEC is considering a broader proposal called Regulation Crypto Assets. It would create two new exemptions for certain crypto-related investment-contract offerings: one for offerings of up to $5 million over four years, and a second for offerings of up to $75 million during a 12-month period, subject to additional disclosure and reporting requirements. A conditional safe harbor could allow qualifying crypto assets to fall outside the definition of an investment contract, potentially giving issuers a clearer route to raise capital in the US rather than structuring projects offshore.
The framework builds on formal guidance issued earlier this year clarifying how federal securities laws apply to crypto. The SEC stated that a crypto asset may not itself be a security, but its sale can fall under securities law if offered through an investment contract. The agency continues to apply principles derived from the Howey test, including whether investors expect profits based on the managerial efforts of others. The article notes that regulatory treatment can depend on how an asset is marketed and sold rather than only on the underlying technology.
The article characterizes these measures as a shift away from broad uncertainty toward detailed rules, with the central question moving from whether digital assets will be regulated to what permanent rules will look like as crypto integrates with traditional finance.
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