BNY Mellon Granted SEC Exemption for Institutional Crypto Custody

September 20, 2023: Un Chained Crypto reports that BNY Mellon, the largest custodian bank in the US, has received an exemption from the Securities and Exchange Commission (SEC) regarding SAB 121 accounting guidelines for its institutional cryptocurrency custody business. This is a significant breakthrough for banks looking to enter the institutional crypto custody space.

During public testimony before the Wyoming Blockchain, Financial Technology, and Digital Innovation Committee, Chris Land, general counsel for US Senator Cynthia Lummis (R-WY), confirmed that the SEC, along with potentially other regulatory bodies, has paved the way for BNY Mellon to offer institutional digital asset custody services.

Land stated in his testimony, “BNY Mellon is looking to get more involved in crypto custody, and they were running into some issues with SAB 121, and the SEC has clearly given them some kind of exemption so they can move forward.”

This development follows a surprise announcement by SEC Chief Accountant Paul Munter, who revealed that the agency had granted some SAB 121 exemptions. Munter stated that these exemptions were primarily based on the finding that the rule may not apply to certain entities if specific conditions are met. He mentioned that a bank, several broker-dealers, and other entities using blockchain to track and transfer traditional financial assets had received exemptions, but he did not disclose the specific names of these entities.