The U.S. Securities and Exchange Commission has issued guidance on how broker-dealers can maintain physical possession of crypto asset securities. This statement addresses requirements under Rule 15c3-3 to ensure customer protections. The update aims to provide regulatory clarity amid growing digital asset markets.
On December 17, 2025, the SEC's Division of Trading and Markets released a statement outlining conditions under which a broker-dealer achieves "physical possession" of crypto asset securities, as required by Rule 15c3-3 of the Securities Exchange Act of 1934. This rule mandates that broker-dealers obtain physical possession or control of all fully paid and excess margin securities held for customers.
According to the statement, possession is established if the broker-dealer has access to the crypto asset security and can transfer it on the applicable blockchain network. Additionally, the firm must implement, maintain, and enforce written policies and procedures covering key areas: details of the network, including governance and updates; safekeeping of private keys needed for access and transfers; and measures to ensure continued accessibility during network disruptions or other major events.
However, a broker-dealer will not be considered to have possession if it knows of any material security or operational issues with the underlying network. This guidance builds on existing customer protection frameworks, adapting them to the unique aspects of blockchain technology without introducing new obligations.
The statement reflects ongoing efforts to integrate crypto assets into regulated financial systems, helping broker-dealers comply while mitigating risks. It does not alter the core requirements of Rule 15c3-3 but specifies how they apply to digital securities. Industry observers note that this clarity could encourage more broker-dealers to handle crypto assets, potentially expanding legitimate market participation.
