Oct. 28, 2023
Public Comment on Regulation regarding Safeguarding Advisory Client Assets Dear Securities and Exchange Commission, I am writing this public comment to express my concerns and raise important issues regarding the proposed rule on "Safeguarding Advisory Client Assets" by the agency. While I appreciate the SEC's efforts to enhance investor protections and address gaps in the custody rule, I believe there are areas of the proposal that require further consideration and improvement. In particular, the inadequate consideration of self-custody solutions and the privacy concerns associated with allowing numerous third parties to access sensitive financial data are significant matters that need attention. Firstly, I am deeply concerned about the lack of adequate consideration given to self-custody solutions in the proposed rule. Blockchain technology and cryptocurrencies have revolutionized the financial landscape, offering users the ability to have full control and ownership of their assets. However, the current proposal fails to recognize the potential of self-custody solutions in safeguarding client assets. By not acknowledging and accommodating these innovative solutions, the SEC is impeding the development of user-controlled asset management and hindering the fundamental principles of financial freedom and autonomy. Furthermore, I strongly believe that the privacy and safety of personal and financial information should be paramount when considering any regulatory requirements. The proposed rule necessitates sharing sensitive data, including financial information and social security numbers, with multiple third parties who may not have adequate security measures in place. This raises concerns regarding the vulnerability of personal information and the potential for identity theft and fraud. It is essential that the SEC takes into account the privacy rights of investors and provides robust safeguards to minimize any potential risks to their personal information. Additionally, it is important to highlight the SEC's lack of understanding and knowledge about cryptocurrencies and blockchain technology. The rapidly evolving nature of these technologies requires regulators to stay informed and adapt accordingly. The failure to do so not only hinders innovation but also puts American investors at a disadvantage compared to their global counterparts. It is crucial for the SEC to invest in comprehensive research and collaboration with industry experts to ensure its regulations align with the realities and potential of cryptocurrencies and blockchain technology. In conclusion, I urge the Securities and Exchange Commission to address these concerns and reconsider certain aspects of the proposed rule on "Safeguarding Advisory Client Assets." The SEC should give due consideration to self-custody solutions, embracing the principles of autonomy and financial freedom they represent. Moreover, the privacy concerns associated with sharing personal and financial information should be thoroughly addressed with robust safeguards to protect investors from potential risks. It is essential for the SEC to become more knowledgeable about cryptocurrencies and blockchain technology to create a regulatory environment that promotes innovation while safeguarding investor interests. Thank you for considering my public comment. I trust that you will take these concerns into account and make appropriate revisions to the proposed rule.