Prometheum, a New York-based digital asset company, has launched the first SEC-compliant Ethereum (ETH) custody service, setting a new milestone for industry compliance.
This service treats ETH as a security under U.S. Securities and Exchange Commission (SEC) regulations.
Prometheum pioneers regulated Ethereum storage service
Prometheum, known for its controversial stance on digital assets, has launched an ETH custody service with a select group of companies. The full launch is scheduled for the first week of June. Co-CEO Aaron Kaplan emphasized that this is the first time that investment contracts involving digital assets are managed and processed under securities laws.
“This launch is an important step toward a regulated and secure digital asset market,” said Kaplan.
Prometheum has designed its services for institutional clients, including asset managers, hedge funds, banks, and registered investment advisors. The company aims to expand to retail customers within 2024, providing comprehensive digital asset management under strict regulatory compliance.
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In 2023, Prometheum secured a special purpose broker-dealer license from the Financial Industry Regulatory Authority (FINRA) and the SEC. Despite these achievements, many industry leaders oppose classifying cryptocurrencies as securities, which contrasts with Prometheum’s approach.
Regulatory inconsistencies add to this uncertainty. SEC Chairman Gary Gensler suggested that Ethereum could become a security. But Commodity Futures Trading Commission Chairman Rostin Behnam considers it a commodity. Last March, House Financial Services Committee Chairman Patrick McHenry and House Agriculture Committee Chairman Glenn Thompson urged the SEC to clarify the classification of ETH.
Prometheum believes that a clear legal path exists for cryptocurrencies and demonstrates this through its Ethereum custodial service. Prometheum’s move could set a precedent for other companies as the SEC continues to enforce regulations. If successful, it could validate the SEC’s regulatory framework and serve as a model for other digital asset companies seeking compliance.
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