Securities and Exchange Commission 100 F Street NE Washington, DC 20549 Subject: Public Comment on Proposal "Safeguarding Advisory Client Assets" (File No. TBD) Dear Securities and Exchange Commission, I am writing to provide my public comment on the proposed rule "Safeguarding Advisory Client Assets" (the "Proposal") (File No. TBD), which aims to enhance investor protections and address gaps in the safeguarding of client assets by investment advisers. While I appreciate the SEC's efforts to strengthen the custody rule, I am concerned about the absence of regulatory clarity for security tokens and the potential challenges presented by digital assets, particularly cryptocurrency. The rise of digital assets, such as cryptocurrency, has brought about significant innovation in the financial industry. These assets, built on blockchain technology, offer new investment opportunities for individuals and institutions alike. However, the regulatory landscape surrounding digital assets remains uncertain, impeding effective investor protection. For the Proposal to effectively safeguard client assets, it is crucial to provide clear regulatory guidelines specifically addressing security tokens. Security tokens represent digital assets that are subject to securities regulations. While the Proposal discusses the application of the rule to crypto assets, it fails to offer clear guidance specific to security tokens. This lack of regulatory clarity creates uncertainty and hinders investor protection. To ensure a level playing field for investors and investment advisers operating with digital assets, it is imperative that the SEC provides comprehensive guidance and regulatory frameworks for security tokens. This will promote market transparency, investor confidence, and protect against potential fraudulent activities. Therefore, I urge the SEC to consider including explicit provisions that address the unique characteristics and risks associated with security tokens within the Proposal. Furthermore, as digital assets and cryptocurrencies advance, new challenges arise in demonstrating exclusive control over these assets. The Proposal rightly acknowledges these challenges; however, it falls short of providing practical solutions. To enhance investor protection, specific guidelines should be established to verify and validate the exclusive control over digital assets, taking into account the unique nature and technological underpinnings of these assets. By doing so, the SEC can ensure effective custody safeguards for client assets held in digital form. Additionally, the Proposal should consider the potential impact of digital asset custody on traditional qualified custodians. Given the unique technological requirements and risks associated with digital assets, qualified custodians may incur increased compliance costs and face obstacles in meeting these requirements. Any new regulatory framework must strike a balance between investor protection and maintaining a competitive landscape for qualified custodians, ensuring that investor access to digital asset investments is not unduly restricted. In conclusion, I appreciate the SEC's efforts to enhance investor protections through the proposed rule "Safeguarding Advisory Client Assets." However, I believe the absence of regulatory clarity for security tokens and the challenges posed by digital assets require greater attention and specific guidelines within the Proposal. To meet the evolving needs of the investment advisory industry and provide effective safeguards, it is essential to address these concerns. I thank the SEC for considering my comments and for its commitment to promoting investor protection in the ever-evolving digital asset landscape. As the Proposal moves forward, I trust that the SEC will review and address these concerns, strengthening the regulatory framework while fostering innovation in the financial industry. Yours sincerely, Rainer Winkler