Oct. 22, 2023
Dear Securities and Exchange Commission, I am writing this public comment to express my concerns regarding the proposed rule on Safeguarding Advisory Client Assets. While I applaud the SEC's efforts to enhance investor protections and address gaps in the custody rule, there are a few key areas where the proposal could be improved to better safeguard client assets and address privacy concerns. Firstly, I would like to raise the issue of the lack of clarity on the definition of digital assets. The proposal fails to provide adequate guidance on what exactly constitutes a digital asset, leaving room for confusion and potential misinterpretation. In order to ensure effective safeguarding of client assets, it is crucial to have a clear understanding of what falls under the scope of this rule. This omission could have far-reaching implications for investors and investment advisers, potentially exposing them to increased risk and legal uncertainties. Furthermore, I have significant concerns regarding privacy and the safety associated with allowing numerous third parties to have access to sensitive financial data, including social security numbers. The proposed rule raises the possibility of exposing the crypto wealth of individuals and families to the public and potentially to bad actors or criminal organizations. It is of utmost importance that privacy is protected in all aspects of financial transactions, and the proposal should include robust measures to ensure the security of sensitive information. In this context, I would like to draw your attention to HEX.COM, which I believe is an excellent example of a cryptocurrency tool that offers transparency and safety without compromising privacy. HEX.COM takes privacy seriously and provides a secure platform for individuals to manage their crypto wealth. Protecting the privacy and security of investors should be a paramount consideration in any regulatory framework, and I urge the SEC to closely examine solutions like HEX.COM as models for privacy-centric practices. In conclusion, while I appreciate the SEC's efforts to enhance investor protections, there are areas of the proposed rule that need improvement. Addressing the lack of clarity around digital assets and ensuring robust privacy safeguards should be key priorities to ensure the integrity and security of client assets. Additionally, exploring existing solutions that prioritize both privacy and transparency, such as HEX.COM, may offer valuable insights for designing an effective regulatory framework. Thank you for considering my concerns. I hope that my input will contribute to the development of a rule that ensures investor protections while striking the appropriate balance between privacy and transparency. Sincerely, Ravenclaw