Oct. 28, 2023
Dear Securities and Exchange Commission, I am writing this public comment to express my concerns regarding the "Safeguarding Advisory Client Assets" proposal. While I appreciate the SEC's effort to enhance investor protections and address gaps in the custody rule, I find certain aspects of the proposal to be lacking in clarity and potentially burdensome, especially for small businesses and start-ups. Firstly, I would like to highlight the lack of clarity in the definition of digital assets. The proposal does not provide clear guidance on what constitutes a digital asset, leading to confusion and potential misinterpretation. Given the fast-paced nature of the digital asset space, it is imperative that a comprehensive and well-defined definition be established to ensure effective regulatory oversight without stifling innovation. Furthermore, I am concerned about the impact this proposal may have on small businesses. The additional reporting requirements and the need to track personal identifiable information could significantly burden small advisory firms and start-ups who may not otherwise be required to engage in such extensive tracking protocols. This will inevitably lead to increased costs for these businesses, potentially placing them at a disadvantage and hindering their ability to compete and innovate. It is vital that the SEC carefully considers the impact on small entities and explores ways to mitigate potential adverse effects without compromising investor protections. In addition to these specific concerns, I also want to raise an overarching issue regarding the proposed rule's potential violation of international norms. As a participant in the global financial market, it is essential for the SEC to take into account internationally recognized standards when formulating regulations. Failure to align with these norms could undermine trust and hinder cross-border collaborations, ultimately harming the competitiveness and reputation of the U.S. market. I urge the SEC to ensure that the proposed rule adheres to international best practices, promoting a harmonious global regulatory environment. In conclusion, while I appreciate the SEC's efforts to enhance investor protections through the "Safeguarding Advisory Client Assets" proposal, there are significant concerns that must be addressed. The lack of clarity regarding digital assets, the potential impact on small businesses, and the need to adhere to international norms are critical issues that require careful consideration. I respectfully request that the SEC takes these concerns into account and makes necessary revisions to the proposal. Thank you for considering my comments as part of the public comment process. Sincerely, Pulse Burn