Coinbase, one of the largest cryptocurrency exchanges in the world, has responded to a recent proposal by the Securities and Exchange Commission (SEC) that is related to cryptocurrency custody.
According to Paul Grewal, the company's chief legal officer, Coinbase Custody Trust is a qualified custodian today and will remain so tomorrow despite the SEC's most recent move.
Grewal indicated that the proposal was just the beginning of what appears to be a long journey. "This is not a final action — it’s just the first step in a long process that requires the SEC to collect public views before considering next steps," he wrote.
While commending the SEC for following the proper procedures for public rulemaking, the chief legal officer stressed that the proposal is just that – a proposal.
The regulator responsible for policing Wall Street has proposed new rules to increase the safety of customer assets, including alternative assets like art and cryptocurrencies.
The SEC has suggested that investment advisers should secure all client assets they manage with qualified custodians. This comes after the high-profile collapse of several crypto companies, which led to the revelation that customer funds were not as secure as advertised.The proposed rules would apply to all asset classes, but much of the discussion has been about their application to crypto.
Investment advisers would have to draw up written agreements with qualified custodians to ensure client assets were protected in case of custodian collapse.