US Securities Exchange Commission (SEC) has voted 4-1 in favour of a proposal to amend the Custody Rule under the Advisers Act. Under the new proposed amendments, the requirement for advisers and qualified custodians to segregate investors’ assets will be expanded to all assets, including crypto. It also proposed to explicitly include a requirement that foreign financial institutions serving as qualified custodians must provide segregation and bankruptcy remoteness. Advisers and qualified custodians must also enter into written agreements with each other that include certain provisions to ensure the custodians’ protection. These provisions require qualified custodians to undergo annual evaluations from public accountants, provide account statements, and make records available upon request. The SEC Chairman Gary Gensler said crypto firms may not be qualified custodians based on the way they generally operate.