Deep Tide TechFlow news, July 02, Galaxy posted on X platform stating that many Registered Investment Advisors (RIAs) find it difficult to respond to client demand for allocating funds to DeFi while meeting the compliance requirements of the SEC's custody rules. The main pain point is that current rules require client assets to be held by qualified custodians, effectively excluding self-custody paths, making it difficult for traditional financial accounts to directly participate in DeFi strategies.

Galaxy believes that a possible solution in the future is to establish a principle-based regulatory framework, including MPC key management, governance controls, third-party audits, on-chain transparency, and strict protocol due diligence mechanisms, to unlock on-chain asset allocation capabilities without undermining regulatory objectives.