In this episode, hosts Adam and Steve are joined by special guest Matt Kolesky to dive deep into the SEC's proposed Safeguarding Client Assets rule. The rule aims to update the current custody rule but has sparked debates about its necessity and potential repercussions.
During the discussion, the hosts question whether the proposed rule is attempting to address non-existent problems, considering that custody for financial advisors has been functioning effectively. They draw parallels to Lt. Daniel Kaffee's famous line, "Why the 2 orders?" to emphasize the redundancy of some aspects of the rule.
The conversation also highlights the proposed rule's focus on combating fraud and theft, despite such activities already being illegal. This raises concerns about the necessity and effectiveness of additional regulations. Additionally, the potential consequences of the onerous rules are explored, including the potential impact on competition, favoring larger firms while hindering smaller, niche players.
One key point of contention is the classification of most crypto custodians as non-qualified, which would limit investors' access to professional guidance and diminish their options in the growing crypto market.
Ultimately, the episode underscores the potential ramifications of the proposed rule, including increased costs for financial advice, reduced competition, and limited investor choices. The hosts encourage listeners to engage in the discussion surrounding these regulatory changes and consider alternative approaches that balance investor protection and innovation.
Tune in to gain valuable insights and join the dialogue on the potential ramifications of the proposed Safeguarding Client Assets rule.
Connect with Adam:
Linkedin.com/in/adamblumberg/
Twitter: @Interaxis8
Connect with Steve:
Linkedin.com/in/stevelarsen1/
Twitter: @Defi_Steward
Connect with the DAO:
Proposed Custody Rule: Navigating the Implications