On February 26, 2021, the Division of Examinations (“Division”) of the US Securities and Exchange Commission (“SEC”) published a risk alert regarding its continued focus on digital assets (“Risk Alert”). The term “digital asset,” as used in the Risk Alert, refers to an asset that is issued and/or transferred using distributed ledger or blockchain technology (“distributed ledger technology”), including, but not limited to, so-called “virtual currencies,” “coins” and “tokens.” This Legal Update summarizes the Division staff’s observations regarding, and areas of focus in examinations of, investment advisers in connection with their management of Digital Asset Securities, as well as other digital assets and derivative products, for advisory clients.