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What is a qualified custodian?
A qualified custodian is a firm that US rules allow an SEC-registered investment adviser to use to hold client assets, such as a bank or a broker-dealer. Under the SEC's custody rule, an adviser that holds, or can obtain, client funds or securities must keep them with one.
What it means for you
In the US, if a registered adviser manages assets for you, this rule decides where they can be held and whether an independent accountant checks they exist. On 1 October 2026 the SEC proposed changes to these custody rules aimed at crypto assets, including state trust companies as custodians; these are proposals, not final rules.
How it works
As the SEC's investor office describes it, SEC-registered investment advisers that hold or can obtain possession of client funds or securities must maintain them with a qualified custodian, like a bank or broker-dealer. Advisers with custody are also generally required to undergo an annual surprise examination, in which an independent public accountant verifies the assets exist, and to keep records of all purchases and sales for each client. Broker-dealers separately follow a customer protection rule requiring them to keep customer assets apart from the firm's own. A 2026 commissioner statement notes that few traditional custodians have offered custody for a wide range of crypto assets.
Sources: SEC investor alert: Exercise Caution with Crypto Asset Securities, SEC: Commissioner statement on proposed amendments to custody rules (1 October 2026) · checked 4 October 2026
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