The Chairman of the US SEC said that the new rules were being drafted, and the encrypted trading platform might not be a qualified custodian

On March 3, Gary Gensler, the chairman of the US SEC, said in an article on the official website of the SEC that he had joined the Investor Advisory Committee. The committee recently submitted a new investment adviser protection rule. According to the provisions of Congress in 2010, this rule extends the custody rule to cover all assets of investors, not just their funds or securities. The proposed rules will also require a written agreement between the consultant and the custodian, increase the requirement for foreign institutions to act as the custodian, and explicitly extend the safeguard rules to discretionary transactions.

Interpretation of this information:

The message highlights the recent step taken by the chairman of the US Securities and Exchange Commission, Gary Gensler, where he has joined the Investor Advisory Committee. The committee has recently submitted a new investment adviser protection rule that aims to enhance the security and protection of investors’ assets.

The proposed rule extends the coverage of the custody rule, which was previously limited to just the funds and securities of the investors. However, with this new rule, all assets of the investors will be included in the custody rule, which will ensure that the investor’s assets are protected, and the advisors cannot take advantage of the investor’s assets in any way.

Additionally, the proposed rule will require a written agreement between the consultant and the custodian, which will provide further protection to the investor’s assets. This agreement will lay out clear guidelines and instructions for the custodian to follow, which will ensure that the assets are being managed and looked after correctly.

The proposed rule will also put more responsibility on foreign institutions who act as custodians. They will be required to meet higher standards and requirements to ensure the investor’s assets are adequately protected. This step will ensure that investors who invest in foreign markets are not at risk of losing their assets due to a lack of accountability in the foreign market.

Finally, the proposed rule will explicitly extend the safeguard rules to discretionary transactions. Discretionary transactions refer to investment decisions that advisors make on behalf of their clients without seeking their explicit approval. These types of transactions can be risky, and there is always the possibility of the advisor taking advantage of the client’s trust. By extending the safeguard rule to discretionary transactions, the investor’s assets will be further protected, and the advisors will be required to follow strict guidelines to ensure the investor’s interests are being looked after.

Overall, the proposed rule is a step in the right direction towards enhancing the protection of investor’s assets. By extending the custody rule, requiring written agreements, increasing the requirements for foreign institutions, and explicitly extending the safeguard rule to discretionary transactions, the proposed rule will provide investors with greater confidence in the investment process and ensure their assets are adequately protected.