According to CoinMeta, the U.S. Securities and Exchange Commission (SEC) has proposed a new framework for the custody of crypto assets, aimed at providing alternative solutions for investment advisors and regulated funds in cases where traditional custodians are unable to support digital assets. The proposal, announced on October 1st, covers registered investment advisors, registered investment companies, and business development companies, and introduces rules and amendments under the 1940 Investment Advisors Act and Investment Companies Act. It also addresses issues related to advisor audits and brokerage dealer custody services. The biggest change is that it provides advisors with the option to self-custody their crypto assets under certain circumstances and officially recognizes state trust companies as potential custodians. Current custody rules are primarily designed for traditional financial assets held by banks, brokerage dealers, and other permitted custodians. SEC Chair Paul Atkins pointed out that the lag in current rules is one of the reasons for this proposal. The proposal also updates the financial statement audit requirements for registered advisors and the rules regarding brokerage dealer custody services for regulated funds. The SEC will accept comments on the proposal for 60 days after its publication in the Federal Register; the comment period will determine the scope of the new custody options and the conditions that advisors and state trust companies must meet.