Oct. 29, 2023
Dear Members of the Securities and Exchange Commission, I am writing to express my concerns regarding the proposed rule on "Safeguarding Advisory Client Assets." While I understand the need to enhance investor protections and address gaps in the custody rule, I believe that certain aspects of the rule may overstep the SEC's regulatory authority, possibly infringing on areas that should be under the jurisdiction of other agencies. One specific concern revolves around privacy rights. The proposed rule would require investment advisers to share comprehensive client information, including sensitive financial data and social security numbers, with numerous third parties. This raises apprehensions about the privacy and security of this data, considering the ever-present risk that such information could end up in the wrong hands, even unintentionally. It is paramount that we preserve the right to privacy, particularly in our current digital age, where safeguarding personal data is of utmost importance. Moreover, it is crucial to strike a balance and prevent excessive regulation that might stifle innovation in the rapidly evolving financial industry. While centralized exchanges already implement identity verification through Know Your Customer (KYC) procedures, decentralized exchanges operate in a different manner. They rely on individuals collaborating online through mathematical algorithms, ensuring privacy and reducing the need for intrusive oversight. Overregulation in this domain could hinder the development of vital technological advancements and limit growth opportunities. Doing math online with others shouldn't be restricted, it is speech. I strongly urge the SEC to thoroughly weigh the potential consequences of the proposed rule on individual privacy rights and the hindrance of innovation. It is vital to find a middle ground that ensures investor protections without unduly burdening market participants. Thank you for taking my concerns into consideration. Sincerely, Eli J. Putt