April 20, 2022
Regarding SR-NSCC-2022-801 and SR-NSCC-2022-302
The proposal, as I understand it, allows market makers, including the DTC and its affiliates, to kick the can with fail to deliversthis is completely unacceptable and, once again, allows only the largest players in the market to run rough-shot over retail investors by simply not holding these mega money investment outfits accountable for their poor judgement and lack of financial responsibility. This is the 3rd time a proposal such as this one has been brought up for consideration by the same group of irresponsible participants seeking approval to avoid their missteps. Permitting this alteration of the rules would give the broadest number of market participants (retail investors, namely) absolutely ZERO confidence in your ability to conduct a fair and efficient market.
What SHOULD be done in place of this proposal is to permanently block FTDs from being permitted in any form. They should not be allowed to exist, as their very existence is a threat to the stability of the markets because, as more and more investors become aware of their persistent presence, they erode the trust necessary to all players seeking entry into the capital markets. If you permit FTDs to be allowed, you are signaling that the markets are untrustworthy and that your system is essentially a Ponzi scheme designed to siphon money from investors and fatten those permitted to dabble in FTDs. As a financial advisor, it is imperative that I give sound advice to my clients, but how am I supposed to tell them it is okay to trust the market when it has purposefully designed flaws such as FTDs that will necessarily harm the investments they choose to make? How can I, and by extension my clients, trust this system to be fair and just when those who have established the market have mechanisms in place to undermine and such fairness?
Fix this problem. No doing so is a risk to centralized exchanges. You are losing the trust and confidence of the masses as you prop up those who would gain the system by hook or by crook. The markets are either fair for ALL participants or they are not. There is no in-between.