NYDFS tightens crypto custody regulations

The New York State Department of Financial Services has issued new guidance to strengthen cryptocurrency custody regulations, FinanceFeeds reported. The guidance codifies the principle that customer assets must be protected to the greatest extent possible, even in the event of a custodian's bankruptcy. Additionally, the new rules clarify standards for sub-custodians and the content of contractual agreements, while strictly controlling the re-lending or re-hypothecation of customer assets.