The U.S. Securities and Exchange Commission (SEC) proposed broad changes to Advisers Act Rule 206(4)-2, popularly known as the “custody rule,” on February 15, 2023. The amendments would create a new Rule 223-1 that would broaden the prior custody rule into the “safeguarding rule” by expanding its coverage to all investment assets held in an advisory account and not merely client funds and securities. The expanded reach of the safeguarding rule would include certain assets not considered securities, such as cryptocurrencies and other crypto assets, real estate and other physical assets, financial contracts not subject to SEC regulation, and physical commodities.