New SEC Proposed Safeguarding Rule | FintechLinks | Blogs | Insights | Linklaters

The U.S. Securities and Trade Fee (SEC) lately proposed overhauling the Custody Rule underneath the Advisers Act to reinforce the safety of buyer belongings managed by registered funding advisers. These enhancements, that are proposed to be embodied in new rule 223-1 underneath the Advisers Act (Proposed Safeguarding Rule), may enhance the associated fee burden on crypto custodians and funding advisers – and hurt their shoppers – prompting the necessity to exempt funding advisers from sure features of the Proposed Safeguarding Rule. We define a number of the impacts of the Proposed Safeguarding Rule in a latest consumer alert, linked under. Our consumer alert additionally proposes an exemption from the Proposed Safeguarding Rule that provides funding advisers the pliability to custody consumer belongings with no certified custodian till a extra sturdy custody market (significantly with regard to DeFi) develops, whereas additionally safeguarding in opposition to the abuses that the Proposed Safeguarding Rule seeks to stop.

New SEC Proposed Safeguarding Rule: Inadvertent Crypto Casualties

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