June 14, 2023
Subject: Opposition to Arbitrary Expansion of Exchange Act Rule 3b-16 To the US Securities and Exchange Commission,
I am writing to express my concern regarding the potential arbitrary expansion of the Exchange Act Rule 3b-16, specifically as it pertains to the burgeoning cryptocurrency and blockchain industry. Such an expansion would be not only be an overreach of regulatory authority, but also a misguided attempt to impose outdated rules upon a rapidly evolving technological landscape that bears little resemblance to the traditional financial markets for which these rules were initially designed.
Decentralized blockchain technology is fundamentally different from traditional financial systems, and attempting to apply the same regulatory framework to these innovative technologies without due consideration for their unique properties is not only ineffective, but also has the potential to stifle innovation and hinder the growth of the industry. By attempting to retroactively expand existing rules for the purpose of political gain, the SEC would be ignoring the nuances of this transformative technology, thereby hindering its potential to revolutionize industries, create new markets, and empower individuals around the world.
The Exchange Act Rule 3b-16 was written decades before cryptocurrencies and blockchain technology were even conceived, and applying these rules to such a fundamentally different technological landscape is akin to trying to fit a square peg into a round hole. The rapid development of decentralized digital assets and blockchain technology necessitates a more thoughtful and nuanced regulatory approach one that recognizes the unique characteristics and potential of these technologies, while also ensuring adequate investor protection and market integrity.
I urge the SEC to reconsider any plans to arbitrarily expand the scope of the Exchange Act Rule 3b-16 as it pertains to cryptocurrencies and blockchain technology. Instead, I advocate for the development of a more tailored regulatory framework that takes into account the unique properties of these technologies, and fosters innovation and growth in this exciting new industry.
In conclusion, it is crucial for the SEC to recognize that decentralized blockchain technology cannot be regulated effectively by applying outdated rules written for a vastly different financial landscape. The arbitrary expansion of the Exchange Act Rule 3b-16 would constitute institutional regulatory overreach, and would be detrimental to the development and growth of the cryptocurrency and blockchain industry. I request that the SEC take a more measured, thoughtful approach to regulating this innovative technology, in order to ensure that its full potential can be realized without being stifled by outdated regulatory constraints.
Sincerely,
Markus Osterlund