Oct. 22, 2023
Dear Securities and Exchange Commission, I am writing to provide my public comment on the "Safeguarding Advisory Client Assets" proposal, which aims to enhance investor protections and address gaps in the custody rule. While I commend the SEC for addressing the safeguarding of client assets, I have concerns regarding the lack of clarity on the definition of digital assets. The proposal does not provide clear guidance on what constitutes a digital asset, leading to confusion and potential misinterpretation. This lack of clarity raises concerns about how investment advisers will handle and safeguard assets that fall under this category. It is imperative that the SEC clearly define digital assets to ensure consistent and effective regulation in this rapidly evolving space. Furthermore, I am concerned about potential legal challenges that may arise from the proposed rule. It is essential to ensure that any new regulations are consistent with existing laws, regulations, and constitutional provisions. Failure to comply with legal standards may result in judicial scrutiny and potential rejection of the proposed rule. To avoid conflicts, it is crucial that the SEC carefully considers any inconsistencies or conflicts with existing laws, regulations, or constitutional provisions. This will ensure that the proposed rule stands up to judicial scrutiny and establishes a strong legal framework for the safeguarding of client assets. In conclusion, while I appreciate the SEC's efforts to enhance investor protections and address gaps in the custody rule, I urge the commission to provide clear guidance on the definition of digital assets and carefully consider any potential legal challenges. By doing so, the SEC can establish a robust regulatory framework that protects investors while fostering innovation in the digital asset space. Thank you for considering my comments. Sincerely, Nicolas Alvarez Mondragon