The SEC issued a no-action letter on Sept. 30, allowing investment advisers to use state-chartered trust companies as qualified custodians for crypto assets, opening the door for Ripple, Coinbase, and other digital asset firms to serve registered funds.
The staff guidance clarifies the definition of “bank” under the Investment Advisers Act of 1940 and the Investment Company Act of 1940, addressing uncertainty regarding whether state trust companies meet this definition.
Journalist Eleanor Terrett reported that Brian Daly, Director of the SEC’s Division of Investment Management, told her:
“This additional clarity was needed because state-chartered trust companies were not universally seen as eligible custodians for crypto assets.”
Both statutes require advisers to maintain client assets with qualified custodians, typically banks or trust companies with national fiduciary powers.
Ripple, Coinbase among beneficiaries
The clarity…
