Oct. 30, 2023
I am writing to provide my public comment on the proposal "Safeguarding Advisory Client Assets" put forth by the Securities and Exchange Commission (SEC). As a concerned investor and passionate advocate for the digital asset industry, I believe it is crucial to highlight the potential negative impact these proposed regulations may have on investor access, market innovation, and the overall competitiveness of the United States. While the SEC's intentions to enhance investor protections through the proposed rule are commendable, it is important to approach the topic of regulation with careful consideration for the rapidly evolving digital asset landscape. By defining assets and expanding the scope of the proposed rule to include discretionary authority in custody, there is a genuine concern that investment options in this emerging asset class may unintentionally become limited. This limitation could deter investors from diversifying their portfolios and impede the growth potential offered by digital assets. Furthermore, an excessively restrictive regulatory approach could stifle innovation within the digital asset industry. It is critical to strike a delicate balance between promoting tax compliance and fostering a conducive environment for growth and development in this promising sector. I implore the SEC to explore alternative approaches that offer a level of flexibility to accommodate the unique characteristics of digital assets while simultaneously ensuring compliance with regulatory obligations. Moreover, the proposed regulations hold the potential to undermine the competitiveness of the U.S. market in comparison to global counterparts. The highly varied regulatory frameworks across jurisdictions have created an environment of inconsistency, making it crucial for the SEC to prioritize harmonization and alignment with international standards. I urge the SEC to conduct thorough analysis of the potential impact of these regulations on the global digital asset ecosystem and consider innovative approaches that enable U.S. participants to stay competitive on a global scale. I acknowledge the SEC's responsibility to prioritize investor protection when formulating regulations for the digital asset industry. However, it is crucial that such safeguards do not hamper market innovation. Overly restrictive regulations carry the risk of stifling growth and driving innovative businesses away from the United States, depriving our domestic market of crucial economic advantages. In conclusion, I am grateful for the SEC's efforts to enhance investor safeguards through the proposed rule. However, I urge the Commission to approach the deployment of these regulations with heightened consideration for potential negative impacts on investor access, industry innovation, and the United States' competitive position in the global market. By forging a supportive regulatory environment that nurtures innovation while simultaneously protecting investor interests, the SEC can help position the United States as a global leader in the evolution of the digital asset economy. Thank you for considering my input on this important matter. I trust that the SEC will thoroughly evaluate the potential ramifications of the proposed rule and give due consideration to the concerns raised by stakeholders. I am optimistic that the Commission's final regulatory framework will achieve an optimal balance between investor protection and the promotion of an innovation-driven economy.