News View Non-AMP

SEC May Scrap Biden’s Crypto Custody Rule – Good News for Investors?

Published by
Nidhi Kolhapur

The U.S. Securities and Exchange Commission may backtrack on a proposal to tighten cryptocurrency custody rules, marking another shift under the acting chair’s leadership, influenced by the Trump administration.

SEC Reconsiders Stricter Crypto Rules

The acting head of the U.S. SEC, Mark Uyeda, announced on Monday that the agency might change or even scrap stricter rules proposed by the previous administration. 

Speaking at the 2025 Investment Management Conference in San Diego, Uyeda raised concerns over a February 2023 rule requiring investment advisers to store crypto assets with “qualified custodians.” He pointed out challenges in enforcing the rule and directed SEC staff to work with the agency’s crypto task force to find better solutions.

Concerns Over the Proposed Rules

The custody rule, introduced during the Biden administration, aimed to increase security for crypto investors by requiring investment advisers to follow stricter custody standards. Critics, however, argued that the rule could limit the number of banks willing to work with the crypto sector.

Uyeda also mentioned that the SEC is considering changes to another rule that requires mutual funds and exchange-traded funds (ETFs) to report their holdings monthly instead of quarterly. He suggested that the SEC could withdraw, amend, or delay certain regulations to ensure they are practical and cost-effective.

Regulatory Priorities Under Review

Uyeda emphasized that the SEC should focus on “effective and cost-efficient regulations that respect the limits of our statutory authority,” according to his prepared remarks.

The original custody rule, introduced under former SEC Chair Gary Gensler, sparked opposition from Republicans, crypto firms, and financial companies. Many argued that it would hurt their businesses by limiting options for securely storing crypto assets.

Commissioner Hester Peirce, the only SEC member to vote against the rule, warned that it would reduce the number of available crypto custodians. Uyeda initially supported the rule with some concerns but later questioned how advisers could invest in crypto under its restrictions.

A Shift in SEC’s Approach

This marks the second time this month that Uyeda has asked SEC staff to revisit proposed regulations, signaling a shift in the agency’s approach under the Trump administration.

Meanwhile, Paul Atkins, a former SEC commissioner nominated by Trump to replace Uyeda as permanent SEC Chair, is awaiting Senate confirmation. The SEC is also under pressure from the White House to cut staff, though no specific details have been released.

With the SEC shifting gears, the crypto industry might finally get the breathing room it’s been fighting for.

Nidhi Kolhapur

Nidhi is a Certified Digital Marketing Executive and Passionate crypto Journalist covering the world of alternative currencies. She shares the latest and trending news on Cryptocurrency and Blockchain.

Recent Posts

Trump Coin & Tesla Stock Crash Big Amid Elon Musk & Donald Trump Feud: Here’s What’s Next!

The row of feud between Elon Musk and Donald Trump regarding the bill has been…

June 6, 2025

Ripple News: Bitwise CIO Hints at Progress for XRP ETF Approval

The conversation around cryptocurrency Exchange-Traded Funds (ETFs) continues to surprise the crypto markets everyday, and…

June 6, 2025

Binance Compliance Chief, Tigran Gambaryan Leaves Binance After Detention in Nigeria

Tigran Gambaryan, Binance’s Head of Financial Crime Compliance, is officially parting ways with the crypto…

June 6, 2025

Ethereum’s $2M Options Bet Fuels Hopes of Sharp Price Surge

2025 has been a rollercoaster year for Ethereum. After plunging 45.3% in Q1, ETH rebounded…

June 6, 2025

Fartcoin Surges Over 14% After Coinbase Roadmap Surprise-Here’s What’s Next for the Price!

Fartcoin made headlines this week after a sharp 14% rally following its surprise inclusion in…

June 6, 2025

Coinbase Listing Hype Sends Fartcoin Back Into Top 100

Fartcoin is back in the spotlight! The joke-themed token jumped 12% in just one day…

June 6, 2025