Republican Lawmakers Demand Explanation for Prometheum’s Approval
– Republican members of the House Financial Services Committee, led by Chairman Patrick McHenry, are seeking answers from SEC Chair Gary Gensler about how Prometheum received approval from the SEC as a broker-dealer for crypto.
– They have petitioned the SEC and the Financial Industry Regulatory Authority (FINRA) for more information regarding Prometheum’s registration status.
– The approval timing has raised concerns that it was aimed at demonstrating that new legislation is not needed for regulating digital asset securities.
– There are suspicions that the SEC may have used Prometheum to support Gensler’s argument against new crypto laws.
– Prometheum executives maintain that they followed the registration process like other firms and their technology is compliant with federal securities laws.
Lawmakers Call for Investigation into Prometheum’s Approval
– Republican lawmakers, along with some Democrats, are calling for an investigation into the sudden approval of Prometheum.
– Some Republicans suspect that Prometheum may have provided false testimony to Congress or violated securities laws.
– Democrat lawmaker Ritchie Torres has requested an investigation of the SEC.
– Prometheum’s previous collaboration with a Chinese firm and the involvement of a Chinese entity in the company have raised concerns about national security and data privacy.
– Prometheum’s co-CEO, Aaron Kaplan, has similar views to the SEC and believes existing federal securities laws are sufficient to regulate crypto.
Prometheum’s Approval and China Connection Raise Concerns
– Lawmakers are wary of the approval of Prometheum, a company that has not yet engaged in trading.
– The involvement of a Chinese firm, Shanghai Wanxiang Blockchain Inc., during Prometheum’s early days has drawn attention.
– Lawmakers are concerned about the connection between Wanxiang and the Chinese Communist Party (CCP) and its implications for national security and data privacy.
– Prometheum’s co-CEO, Aaron Kaplan, has also been under scrutiny for his alignment with the SEC and his social media posts.
– The connections between Prometheum’s executives and the SEC and FINRA have also been discussed.
Hot Take: Questioning Prometheum’s Approval Raises Concerns About Regulatory Framework
The demand by Republican lawmakers for an explanation of Prometheum’s approval raises concerns about the regulatory framework for crypto in the United States. The timing of the approval and suspicions of ulterior motives have cast doubt on the SEC’s decision-making process. Additionally, the connection between Prometheum and a Chinese firm, as well as the alignment of Prometheum’s co-CEO with the SEC, have raised concerns about national security and the influence of foreign entities in the crypto space. This incident highlights the need for transparency and robust regulation to ensure the integrity and security of the crypto industry.
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