Oct. 20, 2023
the proposed SEC custody rules may not adequately consider potential social equity issues: Financial inclusion - Stricter custody rules could disadvantage or exclude less resourced groups from participating in digital asset markets. Concentration of power - Regulation may cement control of custody services in the hands of a few large traditional institutions. Geographic imbalances - Rules optimized for the U.S. could ignore needs of investors in other countries and jurisdictions. Individual rights - Expanded surveillance of custodians could infringe on investor privacy and individual freedoms. Innovation barriers - Excessive regulation may stifle crypto innovation that could benefit underserved populations. Wealth inequality - If costs are too burdensome, custody services may become a privilege reserved for wealthier investors. Decentralization values - Strict top-down rules conflict with digital asset ethos of personal control and decentralization. While protecting investors is important, you're right - regulation should not create undue social and economic barriers. The SEC should proactively assess how its custody rules could impact equitable access and outcomes. Tailoring regulation to enable inclusive participation, preserve privacy rights, and allow continued decentralization is key. Crypto-focused investor advocacy groups may provide valuable input to the SEC on crafting more socially conscious custody standards. Sent with Proton Mail secure email.