An RIA crypto services playbook is a written procedure that defines how a registered investment adviser discovers, reviews, advises on, reports, and documents a client's digital asset exposure. It sets the permitted scope, custody and compliance checks, sub-advisor diligence, and recordkeeping a firm follows before making any crypto recommendation.
The point of the playbook is to fix the service scope before recommendations are made. An adviser that defines what it will and will not do up front can document a consistent process across clients, which supports the fiduciary duty and the books-and-records obligations that already apply to the firm. Crypto does not change those duties; it adds custody, tax, and volatility questions that the playbook routes to the right review step.
What Crypto Service Scope Means
Service scope is the line between assets the firm advises on directly and assets it only monitors. A client may hold crypto in a qualified custodian the firm manages, in a self-custody wallet the firm only reports on, or in an exchange account treated as held-away. Each arrangement carries a different custody, billing, and compliance posture, so the scope decision drives most of the steps below. For the broader context of how these pieces fit together, see the Crypto Services for RIAs Hub.
Service Design Steps
- Define permitted crypto services. State which assets the firm advises on, monitors, or excludes, and write the scope into the advisory agreement and Form ADV.
- Update client discovery questions. Add wallet locations, exchange accounts, cost-basis records, and key-holder details to intake.
- Review custody implications. Decide whether assets sit with a Cryptocurrency qualified custodians have emerged to serve institutional requirements. Qualified custody may be required for register">qualified custodian under the SEC custody rule or in self-custody, and how that affects the firm's custody status. See qualified custody vs self-custody.
- Decide how held-away assets are handled. Determine whether the firm advises on, only monitors, or excludes assets it does not control.
- Review billing and reporting. Confirm how crypto positions are valued, fee-billed, and disclosed, and how custody arrangements affect each.
- Evaluate crypto sub-advisors or platforms. Run diligence on any crypto sub-advisor or platform, including SOC 1/SOC 2 reports, Form ADV, and custody model.
- Document recommendations. Record the rationale, risks disclosed, and alternatives considered for each crypto recommendation.
- Coordinate tax and estate referrals. Route cost-basis reconstruction, Form 1099-DA reporting, and succession questions to qualified tax and estate professionals.
- Train advisors. Make sure advisors understand the permitted scope, the disclosures required, and the risks specific to digital assets.
- Review compliance policies. Update written policies, advertising review, and the compliance calendar to cover the crypto services offered.
Key Documents
- Crypto client questionnaire.
- Crypto compliance checklist.
- Custody due diligence checklist, see the crypto custody due diligence checklist.
- Sub-advisor due diligence file (Form ADV, SOC reports, custody model).
- Recommendation documentation template.
Custody and Compliance Checklist
Before the firm advises on any crypto position, confirm:
- The custody arrangement is identified (qualified custodian, self-custody, or held-away) and reflected in the firm's custody analysis.
- The custodian's SOC 1/SOC 2 reports and security model (cold storage, multi-sig) have been reviewed where applicable.
- Form ADV scope language matches the services actually offered.
- Billing and valuation methods for crypto are written and disclosed.
- Each recommendation files the risks disclosed and alternatives considered.
- Tax and estate referrals are documented rather than handled in-house.
Related Questions
Do RIAs need a qualified custodian for client crypto?
Generally, where an adviser has custody of client assets, the SEC custody rule contemplates a qualified custodian, and the analysis for digital assets depends on the facts and the custodian's capabilities. Whether a given crypto arrangement meets that standard is a question for compliance counsel, not a settled rule for every token or wallet type.
Can an RIA use a crypto sub-advisor?
Yes, an adviser can engage a crypto sub-advisor or platform, subject to diligence on its Form ADV, controls, and custody model. Registration of a sub-advisor confirms a filing status; it does not by itself guarantee skill, performance, or that the arrangement fits a particular client.
How should an RIA handle crypto tax reporting for clients?
Crypto is generally treated as property for U.S. tax purposes, so dispositions can create gains or losses, and brokers are moving toward Form 1099-DA reporting. Advisers typically coordinate cost-basis reconstruction and reporting with a qualified tax professional rather than giving tax advice directly.
Sources
- SEC: Investment Adviser Public Disclosure
- SEC: Custody rule compliance guide
- SEC: Commission Interpretation Regarding Standard of Conduct for Investment Advisers
Compliance Note
This playbook is educational and does not provide legal, compliance, tax, investment, fiduciary, or custody advice. Adding crypto services does not remove market, custody, or tax risk, and no process guarantees a particular outcome. RIAs should consult compliance counsel. Registration does not imply a certain level of skill or training.