🚨 WARNING FROM SEC: MUST UNDERSTAND THE RISKS OF CRYPTO CUSTODY!
The U.S. Securities and Exchange Commission (SEC) has just issued new guidance, warning individual investors about the risks of holding digital assets in custody, even as the agency is accelerating the integration of Crypto into the traditional banking system.
🔑 WHY DOES SEC WARN? (CUSTODY RISKS)
- Loss of private key: means losing assets permanently with no way to recover.
- Hot/Cold Wallet Risks:
+ Hot Wallet: Convenient but vulnerable to cyber attacks.
+ Cold Wallet: Safer but at risk of physical loss/damage.
- Third-Party Custody: Investors must thoroughly research whether the custodian is insured, how they handle bankruptcy/hacking, and whether they engage in activities like rehypothecation or asset commingling.
** POSITIVE NEWS FROM REGULATORY AGENCY:
This warning comes amid a significant shift in the U.S. towards supporting Crypto:
- Welcoming Crypto Banks: The Office of the Comptroller of the Currency (OCC) has approved 5 major Crypto companies (Circle, Ripple, BitGo, Fidelity, Paxos) to convert into National Trust Banks.
- SEC has halted lawsuits, approved pilot tokenization (such as DTCC tokenizing Treasury bills), and is focusing on building a regulatory framework to support innovation.
- Vision: SEC Chairman Paul Atkins stated the agency is "mobilizing" to make the U.S. the "global Crypto capital."
👉 In summary: While regulations are gradually paving the way for institutional capital, the SEC reminds individual investors to take personal responsibility and be extremely cautious with the custody of their assets.
