The Financial Industry Regulatory Authority grants Prometheum Ember Capital approval for clearing and settlement services
Prometheum Ember Capital has received approval from the Financial Industry Regulatory Authority (FINRA) to offer clearing and settlement services for digital asset securities. This move is likely to have a significant impact on the crypto industry. Prometheum, a relatively unknown digital asset firm, obtained a special purpose broker dealer license from the Securities and Exchange Commission (SEC) last year, which now allows it to provide custody services. The company claims to be the only federally-compliant access point for crypto trading and custody in the United States. Prometheum plans to start offering custodial services to institutional clients in the first quarter of next year, followed by institutional and retail trading.
A tug of war between crypto exchanges and the SEC
Prometheum’s approval comes at a time when the SEC has been warning crypto exchanges about the need to register with the agency. Coinbase, Binance, and Kraken have faced charges of operating as unregistered exchanges, brokers, dealers, and clearinghouses. However, crypto firms argue that registering with the SEC is not feasible. Prometheum itself has faced criticism from industry players, including probes from the Blockchain Association and Republican lawmakers who alleged that the company had received preferential treatment from the SEC.
Concerns raised by Republican lawmakers
The Blockchain Association expressed concern over a potential “sweetheart deal” between Prometheum and the SEC. Additionally, House Financial Services Committee Chair Patrick McHenry requested information from the SEC regarding a license issued to Prometheum. Republican lawmakers working on crypto regulation legislation have raised questions about timing and possible unfair advantages.
Keep your head down and work within the law
When asked about those who claim it’s impossible to register with the SEC, Prometheum’s co-CEO Aaron Kaplan advised working within the regulations instead of trying to change them. He believes that success can be achieved by properly registering under securities laws and following the rules.
Hot Take: Prometheum’s approval sets a precedent for federally-regulated crypto trading and custody in the US
Prometheum Ember Capital’s approval from FINRA to offer clearing and settlement services for digital asset securities establishes a precedent for federally-regulated crypto trading and custody in the United States. This move is expected to have a significant impact on the crypto industry, as it provides a responsible way for the American public to participate in the digital asset space. By obtaining approval from both FINRA and the SEC, Prometheum positions itself as the only viable option for federally-compliant access to crypto trading and custody. The approval also serves as a reminder to other crypto exchanges about the importance of registering with regulatory authorities. Overall, this development marks a major step forward for the industry.
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