SEC Releases Crypto Custody Guidance as Regulators Greenlight Tokenization and Bank Charters
The Securities and Exchange Commission has taken a decisive step toward regulatory clarity with new custody guidelines for retail investors. Published on December 12, 2025, the Investor Bulletin outlines secure methods for storing private keys—the cryptographic lifelines to digital asset ownership. Hot wallets offer convenience but carry cyber risks, while cold wallets trade accessibility for ironclad security.
Custodial risks loom large in the bulletin's warnings. Third-party providers may rehypothecate assets or pool customer holdings, exposing investors to counterparty failures. The timing is significant: crypto custody services are projected to grow from $3.28 billion to $7.74 billion in the coming years, reflecting institutional demand for regulated solutions.
This guidance arrives alongside broader regulatory shifts embracing tokenization and specialized bank charters. Market participants now have clearer guardrails for safeguarding digital assets—a prerequisite for mainstream adoption.