Oct. 30, 2023
Public Comment on SEC Proposal "Safeguarding Advisory Client Assets" Dear Sir/Madam, I am writing to provide my public comment on the Securities and Exchange Commission's (SEC) proposed rule on "Safeguarding Advisory Client Assets." While I appreciate the intent behind this proposal to enhance investor protections and address gaps in the custody rule, I have concerns regarding certain aspects of the rule that may result in regulatory overreach and compromise privacy. Firstly, I am concerned about the potential overreach of the SEC's regulatory authority. It is crucial to ensure that regulatory agencies do not encroach upon areas that are best regulated by other agencies. This is particularly important in matters of privacy, where sensitive financial data and personal information is at stake. While investor protection is essential, it is equally important to strike a balance that does not infringe on personal privacy rights. In this regard, I would like to highlight the issue of privacy and the safety of our sensitive financial data. The proposal requires the involvement of numerous third parties, who will have access to our financial information and even our social security numbers. It is imperative to assess the potential risks associated with such extensive disclosure requirements. Enhanced precautions and safeguards should be implemented to protect investors from potential privacy breaches, identity theft, and other cyber risks. We must prioritize the protection of personal information while still fulfilling the goal of the proposed rule. Furthermore, I am deeply concerned about the potential negative price impact on cryptocurrencies caused directly by the SEC's targeting of these assets. As cryptocurrencies become increasingly integrated into the financial system, the regulatory approach towards them should be carefully crafted to foster innovation and growth. Overregulation or stringent requirements may stifle the cryptocurrency market, hampering its ability to contribute to the broader economy. The SEC should consider alternative regulatory approaches that strike a balance between investor protection and promoting technological innovation. A collaborative and forward-thinking approach can help foster a vibrant and thriving cryptocurrency ecosystem, benefiting both investors and the economy at large. In conclusion, I urge the SEC to carefully consider the potential overreach of its regulatory authority, particularly in areas that may be better regulated by other agencies. Furthermore, it is crucial to prioritize privacy and protect the sensitive financial data of investors while accomplishing the goal of the proposed rule. Additionally, striking a balanced regulatory approach towards cryptocurrencies can ensure their positive impact on the economy and prevent unintended negative consequences. Thank you for considering my comments, and I appreciate the opportunity to provide input on this important matter. Sincerely, Arturo Maldonado