The SEC’s Division of Trading and Markets has issued informal guidance for broker-dealers on custody of crypto securities and operations of alternative trading systems, aiming to clarify asset handling and market structure expectations.
The U.S. Securities and Exchange Commission’s Division of Trading and Markets released an informal statement and a set of FAQs to assist broker-dealers in managing customers’ crypto securities without violating regulatory expectations. The guidance covers proper custody practices, including safeguarding private keys and preparing for blockchain-related risks such as malfunctions, 51% attacks, hard forks, and airdrops. It also addresses operational considerations for alternative trading systems handling crypto assets, focusing on trading and settlement. While welcomed by industry participants, the statements lack formal rulemaking authority and could be reversed under new SEC leadership.