Below is a guest post Hamilton KeatsCEO and co-founder of Krayon Digital.
In an attempt to prove there is a way forward for cryptocurrency companies within the existing regulatory framework, the SEC invited Promethium to attend the House Financial Services Committee hearings on digital assets.
While this little-known company has been picked up by the SEC as an example of compliance, Prometheum’s background is unclear.this is Suspect The company has been involved in multiple cryptocurrency scams and is likely funded by the Chinese Communist Party (CCP) 😲.
The timing of this hearing coincides with the season of intense weather. scrutiny The SEC is making such criticisms against other companies that have tried to engage in regulatory dialogue, perhaps deserving a chance to operate within a compliant framework more than Promethium.
Let’s unravel this bizarre chain of events
On June 13, the House Financial Services Committee held a meeting. hearing On “The Future of Digital Assets: Defining the Digital Asset Ecosystem”.
Aaron Kaplan, co-CEO of Promethium, was invited to testify before the commission. Until this week, Promethium was relatively unknown in the crypto industry.
During Kaplan’s testimony, it was revealed that his reaction was scripted. Committee members and viewers alike questioned his credibility. His answer reflected the SEC’s existing explanations.as Scott Johnson said:
“Wow, the CEO of Promethium, whose sole qualification is to lead a special purpose ATS/BD for digital securities, seems to have a lot of opinions on unrelated topics like banking principles and stablecoins. Or at least his prewritten memo curiously answers every question the Democrats have.”
Who exactly is the Promethium and why is it associated with this Commission?
Amid the SEC lawsuits against Coinbase and Binance, Prometheum approval Obtains a first-of-its-kind Special Purpose Broker-Dealer (SPBD) license for digital asset securities. According to Kaplan, the license points the way for compliance for cryptocurrency companies, suggesting that no updates to regulations or securities laws are needed.
Commissioner John Rose controversial Aaron Kaplan statement:
“Gensler’s approval of this one Special Purpose Broker-Dealer License does not mean that the current system is working. Why? Moreover, Mr. Gensler and the Democrats, and apparently Mr. Kaplan, said that nearly all tokens are unregistered securities, so this approval would mean nothing to retail investors and the general public. Claiming that it is useless…Is it possible that there are currently no digital asset securities with real customers registered?Demand and liquidity.For example, the ATS recently announced that the SEC Can Solana or Cardano, which claims to be a security, be offered today on the ATS to individual non-accredited investors?”
The answer is a resounding no. However, the proposed bill would allow ATSs to list and trade digital assets alongside payment stablecoins and digital commodities.
Special purpose broker-dealers are currently unable to store both digital asset securities and commodities on the same platform on behalf of individual investors. Current law classifies digital assets as securities or commodities, effectively rendering the SPBD license useless.
Additionally, the SEC has suggested that it expects digital assets to be registered by promoters, but in the world of open source projects with anonymous or pseudonymous founders, this is not a problem.
There are currently zero tokens registered with the SEC, as the existing regime is not feasible on public blockchain networks.
Existing regulations do not allow licensed broker-dealers to operate in the digital asset space.Representative Mike Flood argued What Promethium said during the hearing was complete nonsense. Promethium customers cannot even trade BTC or ETH, which account for 60% of the digital asset market.
Mike Flood says:
“If the current system works, why can’t customers trade the most popular and widely used digital assets?”
The obvious answer is no, and Promethium’s claim that no change in the law is necessary makes no sense at all.
Why would Promethium interfere with regulatory improvement?
If Promethium is allegedly working to establish a broker-dealer business in the digital asset space, why would they block proposed regulatory reforms that would benefit the industry?
Entry into the Promethium Chain: Promethium trading L1 includes: token It has already been sold to members of the Chinese Communist Party (CCP) (laughter emoji).
Promethium almost raised $50 million In funding so far. Throughout the funding process, they utilized a New Jersey-based specialty investment bank. Network 1 financial securities – Companies with a bad track record, including more than 20 regulatory and civil lawsuits, and ties to the Chinese Communist Party.
Perhaps we should assume that Promethium is controlled by trusted securities experts…
Well, it’s also no. Promethium is run by the Kaplan family, which includes Aaron Kaplan and Benjamin Kaplan, full-time attorneys currently in court. not certified He attended law school before joining his father’s law firm.
How did the attorney’s family become the first firm to receive an SPBD license and join a panel testifying in support of the SEC’s current approach to cryptocurrency regulation?
Why aren’t real businesses given fair credit?
Apparently, hiring a former SEC staffer will go a long way toward obtaining a license. Prometheum’s team is made up of former NYSE and her FINRA employee Rosemarie Fanelli. CBOE’s John Tornatore. The company’s chief compliance officer, Joseph Zangri, said he previously served as a senior enforcement attorney for the SEC.
This complex narrative and tangled web of potential fraud raises the question: Is true progress in blockchain technology and digital assets defying in the face of current regulations? Why aren’t real businesses like Coinbase and Kraken given a real chance?
Hamilton Keats CEO and co-founder of Krayon Digital, a provider of MPC-based digital asset wallets for small businesses. At Krayon, before he built the Web3 infrastructure, Hamilton co-founded Platform One, a London-based wealth management platform, where he worked at HSBC and DVB Bank. He holds a Bachelor’s degree in Physics from Imperial College London. twitter