Article Summary

**SEC Commissioners Split on Cryptocurrency Custody Rules as Digital Asset Regulation Evolves** The Securities and Exchange Commission faces internal division over new cryptocurrency custody regulations affecting registered investment advisers and digital asset funds. Commissioner Hester Peirce advocates for increased flexibility in crypto custody arrangements, while Commissioner Caroline Crenshaw raises concerns about potentially compromised investor protections under the revised guidance. This regulatory disagreement highlights the ongoing challenges facing Bitcoin, Ethereum, and broader cryptocurrency markets as traditional financial institutions seek clearer DeFi and blockchain custody frameworks. The SEC's updated guidance could significantly impact how investment advisers handle digital assets, potentially affecting institutional adoption and cryptocurrency market liquidity. The custody rule debate reflects broader regulatory uncertainty surrounding digital asset management, with implications for cryptocurrency exchanges, blockchain technology implementation, and institutional investor participation. As the SEC navigates competing priorities between innovation and investor protection, the outcome could influence Bitcoin price stability and overall cryptocurrency market sentiment. Investment advisers managing digital assets await clarity on compliance requirements, while the crypto industry monitors how these regulatory developments might affect mainstream cryptocurrency adoption and institutional DeFi participation.