Oct. 30, 2023
Public Comment on Regulations.gov To Whom It May Concern, I am writing to provide my comments on the "Safeguarding Advisory Client Assets" proposal by the Securities and Exchange Commission (SEC). While I appreciate the SEC's efforts to enhance investor protections and address gaps in the custody rule, I have concerns regarding the lack of clarity on custody requirements for digital assets, specifically in the context of privacy rights. Digital assets, particularly cryptocurrencies, have revolutionized the financial industry with their decentralized nature and potential for increased efficiency. However, the regulatory landscape surrounding digital assets remains uncertain, causing significant challenges for market participants. It is crucial for the SEC to provide clear guidelines on custody requirements for digital assets to ensure a level playing field and promote investor confidence. One concern I have is the potential impact of these proposed regulations on privacy rights, particularly given the increasing use of digital assets for anonymous transactions. While privacy is an essential aspect of financial transactions, it is crucial to strike the right balance between privacy rights and regulatory compliance. I request further discussion on the measures taken by the SEC to protect individual privacy while ensuring compliance with tax laws. The proposed regulations should ensure that privacy rights are respected while still addressing the legitimate concerns of investor protection. It is essential to take into account the unique characteristics of digital assets and the need for innovative approaches to regulation. Clear and well-defined guidelines for custody requirements will help market participants navigate the evolving landscape and contribute to the growth and development of the digital asset ecosystem. Furthermore, I urge the SEC to engage in a comprehensive dialogue with industry participants, consumer advocates, and privacy experts to ensure that any regulations adopted are effective, proportional, and do not unduly infringe upon privacy rights. This collaborative approach will promote better-informed decision-making and help build a regulatory framework that fosters both innovation and investor protection. In conclusion, I applaud the SEC for its efforts to address the safeguarding of client assets. However, I believe that further clarity is needed on custody requirements for digital assets, with specific consideration given to privacy rights. I welcome the opportunity to engage in further discussions and provide input to develop a regulatory framework that enhances investor protection while preserving individual privacy rights. Thank you for considering my comments, John P.