Some people might say, “Of course it’s different: trading history is not protected expression; it is simply information about an economic transaction with no expressive value.” However, economic transactions offer a window into a person’s deepest thoughts and core values. Our purchases and sales of securities, particularly when aggregated together, are a rich form of value expression. They might express a view of how markets work, a determination on the efficiency of markets, expectations about the future, or even a moral philosophy. Investors’ trades may flow from a carefully crafted trading strategy based on a person’s education, careful data analysis, intuition, or market experience. People may trade to express their belief about how a company, industry, or nation will perform in the short- or long-term. People might sell stock because they fear a recession is coming or buy stock because they anticipate that the election of a particular candidate or party will bring a period of economic prosperity. An investor might buy shares of a movie company because she is sure a particular movie will be popular, shares of a technology company because he/she believes the company’s engineers are geniuses, or the shares of a cellphone provider because he/she believes a strategic merger is on the horizon.
According to SEC commissioner, Hester M. Peirce’s statement, we should not risk our freedom and privacy. If history is any guide, unauthorized access to, or disclosure of, the information contained in the Consolidated Audit Trail (CAT) is almost certainly just a matter of time.
Given these risks, the commissioner advise to eliminate the CAT, and if the Commission believes the program needs further improvement, it could enhance the current rules. The current regime provides the information needed, and incremental improvements to reduce delays and errors could make the commission investigations more efficient without sacrificing Americans’ liberty and privacy.
What if people will use smart contracts to buy shares and other securities? How will the SEC follow them? Does the SEC wants us to use smart contracts to get more privacy?