BlockBeats News, December 14, the U.S. Securities and Exchange Commission (SEC) released a cryptocurrency custody guide, outlining best practices and common risks of different forms of cryptocurrency storage for the reference of the general investor, including the distinction between self-custody and allowing third-party representation of investors. If investors choose third-party custody, they should understand the custodian's policies, including whether the custodian will rehypothecate the custodied assets by lending them out, or if the service provider will commingle customer assets in the same pool instead of storing the cryptocurrency in segregated customer accounts.The guide also outlines the types of cryptocurrency wallets, analyzing the pros and cons of internet-connected hot wallets and cold wallets (offline storage). According to the SEC, hot wallets carry the risk of being vulnerable to hacker attacks and other network security threats, while cold wallets face the risks of offline storage failures, storage device theft, or permanent loss in case of key compromise.

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