Who is Prometheum and what did it tell Congress about SEC compliance?
The crypto company Prometheum, which was relatively unknown, has gained attention after the recent testimony of its co-founder, Aaron Kaplan, before the United States House Committee regarding regulatory clarity for the crypto industry. During the hearing on June 13, Kaplan expressed his support for regulating crypto under current securities laws, a view shared by the Securities and Exchange Commission, in contrast to Coinbase and other industry players. However, Kaplan’s testimony has also raised questions about the company and its co-founder, with Castle Island Ventures partner Matt Walsh calling the situation “bizarre” in a June 14 Twitter thread. The Wall Street-based Prometheum was founded in 2017 by Aaron and Benjamin Kaplan, who are also attorneys at the financial services-focused law firm Gusrae Kaplan. The company’s subsidiaries are notable for their registrations with the SEC and approvals from the Financial Industry Regulatory Authority. In May, subsidiary Prometheum Ember Capital became the first firm to offer custody of digital assets as a qualified custodian after receiving FINRA approval to operate as a special purpose broker-dealer for digital assets. In October 2022, its subsidiary Prometheum Ember ATS launched its SEC-registered alternative trading system offering digital asset trading, clearing, settlement, and custody. Kaplan argued during the hearing that the SEC’s frameworks provide a “compliant path forward for crypto in the United States” and that existing securities laws and regulations apply to cryptocurrencies. However, some have criticized the company for not having much to show product-wise despite its years in business and regulator approvals. During the hearing, Kaplan also confirmed that Prometheum did not offer trading for Bitcoin or Ether, which together make up nearly 65% of the $1 trillion crypto market cap, according to CoinGecko.
At the same time, rumors about the company are circulating on social media, with some stating that the company has connections to the Chinese Communist Party. They point to the 2019 SEC filings from Prometheum that mention HashKey and Shanghai Wanxiang Blockchain as “strategic partners and joint venturers.”
Others have pointed out that Prometheum’s team includes former SEC and FINRA staffers.
Cointelegraph reached out to Prometheum to request a comment regarding some of these claims.
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