U.S. SEC drops Gensler-era plans for tighter crypto custody and DeFi oversight

Eleanor Terrett, host of Crypto in America, reported on X that the U.S. Securities and Exchange Commission (SEC) has officially scrapped several major proposals introduced under former Chair Gary Gensler. She said the expanded Custody Rule would have covered all client assets including cryptocurrencies and widened the definition of custody, prompting concerns over whether certain state-chartered entities could still qualify as custodians. She added that Rule 3b-16 was intended to regulate decentralized finance (DeFi) platforms as national securities exchanges. Terrett also noted that the SEC had dropped its plan to require public companies to comply with stricter environmental, social and governance (ESG) disclosure requirements.