SEC Issues No-Action Letter Permitting Crypto Custody via State Trust Companies

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The US Securities and Exchange Commission has clarified that investment advisers may use state-chartered trust companies as qualified custodians for cryptocurrency assets. The guidance came in the form of a no-action letter issued Tuesday.

According to the letter, certain financial entities—including registered advisers and regulated funds—can now partner with a State Trust Company to hold and manage crypto assets in a manner compliant with custody rules. This provides a new, legally recognized option for advisers who are required to hold client assets with qualified custodians.

This development represents a notable step in the evolving relationship between federal regulators and the crypto industry, which has recently faced scrutiny under interagency efforts like “Operation Choke Point 2.0.”