Davis Polk partner David Portilla was quoted in Bloomberg discussing the future of crypto custody by banks. The article notes that the guidance outlined in the SEC’s Staff Accounting Bulletin No. 121 (SAB 121) makes it impractical for highly regulated financial firms to provide crypto custody and is hindering established financial entrants.

“Although the SEC has begun to provide relief under SAB 121 for banks, it has not done so in a transparent manner that applies across the board,” said David. “The technological, legal and regulatory risks cited by SAB 121 are substantially mitigated by the existing and extensive legal and supervisory framework that applies to banking organizations, yet the SEC’s policy does not reflect that.”

“Guarding Crypto Is a Lucrative Business and Wall Street Wants In,” Bloomberg (September 14, 2024)

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