Harvard Law School: The US SEC's "Employee Accounting Bulletin" may be liable for the FTX incident

According to the Wall Street Journal, citing the Harvard Law School’s Capital Markets Oversight Committee, the U.S. Securities and Exchange Commission (SEC)’s “Employee Accounting Bulletin” issued in March requires banks and their affiliated broker-dealers that manage encrypted assets to include custody assets on their balance sheets. May be responsible for the loss of the user in the FTX event. This regulatory framework results in unregulated crypto exchanges being able to hold or “custody” crypto assets without having to be kept by banks and brokers, preventing misuse of funds and ensuring that customers can get all their funds back, resulting in users who can only become exchanges bankrupt creditors, or cost FTX users billions of dollars.