Comment Text:
I align with Chairman Christy Romero's perspective, found in her comment at link, regarding the integration of clearinghouses and customer-facing intermediaries. I believe this proposed regulatory shift raises concerns about market stability, investor protection, and reduced risk.
This new structure seems to shift substantial risk and leverage to vertically integrated clearinghouses, potentially weakening risk oversight and natural disciplinary mechanisms.
I strongly advise against implementing this new market structure and regulatory proposition.
Quoting Romero: "Our clearinghouse rules were not set up to protect customers..."
Without the intermediary, current clearinghouse rules might undermine customer protection and open doors for investor exploitation. The lack of oversight and consumer defense erodes investor confidence, a pillar of functional markets.
Assurances of fair trade execution become uncertain in this scenario, with reduced competition and regulatory scrutiny.
Romero's insight on vertical integration in crypto platforms is pertinent. The proposal mimics a structure with insufficient investor protection, seen in the crypto space's fraudulent instances.
Romero's previous speech about conflicts of interest in crypto-related companies cautions against replicating unregulated risks in a regulated environment.
This proposal introduces more risks, less oversight, and reduced visibility into consolidated clearinghouses.
In summary, I oppose this proposal, as it could empower clearinghouses, reduce competition, and potentially expose investors and customers to increased risk.
