Subject: S7-04-23: Webform Comments from Jordan Miller
From: Jordan Miller
Affiliation: None

Oct. 29, 2023

I’m writing to provide my public comment on the proposed
rule, "Safeguarding Advisory Client Assets," published by
the Securities and Exchange Commission (SEC). While I appreciate the
aim of enhancing investor protections and addressing gaps in the
custody rule, it is important to consider potential negative impacts
the proposed rule may have on decentralized finance (DeFi) innovation,
as well as concerns regarding privacy and data security.

Firstly, I am concerned that the proposed rule's broad scope may
unintentionally hinder the growth and development of decentralized
finance projects. DeFi offers innovative financial services using
blockchain technology, bringing greater financial inclusion to
underserved communities and fostering peer-to-peer transactions
without reliance on traditional intermediaries. By subjecting DeFi
projects to the same regulatory requirements as traditional investment
advisers, the SEC may hamper the vital innovation and potential of
DeFi, hindering progress and limiting financial inclusion
opportunities.

Furthermore, the proposed rule may pose unnecessary burdens on
investment advisers and qualified custodians. Compliance with multiple
regulatory requirements risks diverting resources away from developing
services that deliver value to clients and promoting economic growth.
While safeguarding client assets should be of paramount importance,
striking a reasonable balance between regulatory oversight and
fostering a dynamic financial ecosystem is crucial. It is essential to
ensure that the proposed rule does not stifle innovation and
inadvertently hinder the evolution of financial services.

Additionally, I am deeply concerned about the potential violation of
privacy associated with the requirement to share sensitive financial
data and social security numbers with multiple third-party custodians.
The proposal's focus on expanded disclosure without due
consideration for robust privacy safeguards raises valid concerns
about the protection of individuals' sensitive personal
information. The SEC should prioritize enhancing privacy protections
within the proposed rule and ensure that the collection, storage, and
transmission of personal data are carried out with the utmost security
and respect for individual privacy rights.

In light of these concerns, I urge the SEC to carefully assess the
potential negative impact of the proposed rule on DeFi innovation. It
is essential to strike a balance between regulatory oversight and
encouraging innovation and financial inclusion. Furthermore, the SEC
should consider implementing stronger privacy safeguards to protect
the sensitive financial information of investors and clients.

In conclusion, I believe that the proposed rule, as currently
structured, may inadvertently hamper the potential growth and
development of decentralized finance projects. It is essential for the
SEC to consider the potential negative impact on innovation and
financial inclusion. Additionally, privacy concerns must be addressed
to safeguard the personal and financial information of investors and
clients. I encourage the SEC to approach this rule-making process with
a nuanced and thoughtful consideration of the issues at hand.

Thank you for considering my public comment. I trust that you will
give thorough and fair consideration to the concerns and suggestions
outlined herein. I appreciate the opportunity to provide input and
actively contribute to this important discussion.