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SEC crypto proposal could bar investment advisers from holding at firms
Crypto is a global phenomenon: Matt Sigel
Matt Sigel, Vaneck Head of Digital Assets Research, discusses the SEC cracking down on crypto regulations and the impact of the industry on the world.
The Securities and Exchange Commission (SEC) on Wednesday proposed a rule that would broaden regulations requiring investment advisors to secure clients' assets with qualified custodians to include cryptocurrency assets, which aren't covered under current regulatory definitions.
The proposal, which was formalized on a 4-1 vote, is in response to regulators' concerns that crypto firms' custodial practices may not sufficiently secure investors' assets if a firm falls into bankruptcy. This comes following the collapse of the FTX crypto exchange, whose founder Sam Bankman-Fried allegedly mishandled billions of dollars worth of investors' funds.
“I support this proposal because, in using important authorities Congress granted us after the financial crisis, it would help ensure that advisers don’t inappropriately use, lose, or abuse investors’ assets. In particular, Congress gave us authority to expand the advisers’ custody rule to apply to all assets, not just funds or securities. Further, investors would benefit from the proposal’s changes to enhance the protections that qualified custodians provide.”
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