Oct. 24, 2023
Dear Securities and Exchange Commission, I am writing to express my concerns and reservations regarding the proposed rule "Safeguarding Advisory Client Assets." While I appreciate the aim to enhance investor protections and address gaps in the custody rule, I believe that certain aspects of the proposal require further clarity and consideration, particularly in relation to digital assets or crypto. One of my major concerns is the absence of regulatory clarity for security tokens. The proposal does not provide clear guidelines on how investment advisers are expected to safeguard and manage security tokens. Given the increasing prevalence of digital assets in the financial landscape, it is imperative that regulatory frameworks provide sufficient clarity and alleviate the uncertainty surrounding their treatment. Furthermore, the evolving nature of digital assets, particularly cryptocurrencies, presents unique challenges that warrant meticulous attention. Without clear regulatory guidelines, investment advisers may struggle to navigate the complexities of this emerging asset class, potentially compromising investor protections. It is paramount that the final rule provide specific provisions for digital assets, ensuring that the interests of investors are safeguarded and that responsible investments can flourish. Additionally, it is worth noting that digital assets built on blockchain technology have the potential to transform the financial industry. However, their potential can only be fully realized through a comprehensive and robust regulatory framework. By failing to address the regulatory uncertainties surrounding digital assets, the proposed rule may inadvertently hinder innovation and impede the growth of this promising sector. In order to promote investor protection, enhance market integrity, and foster responsible innovation, I strongly urge the SEC to revise the proposed rule to incorporate clear guidelines and regulatory clarity for digital assets. This will not only provide certainty to investment advisers, but also instill confidence in investors seeking to participate in this rapidly evolving market. Thank you for considering these concerns and the importance of providing regulatory clarity in relation to digital assets. I urge the SEC to take these points into serious consideration as you move forward with the proposed rule. If any clarifications or further comments are required, please do not hesitate to reach out to me. Sincerely, Joseph Simmons