9 months ago
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Starting custody service
Prometheum, an American cryptocurrency investment services company, announced on the 7th that its subsidiary Prometheum Capital will initially provide custody services for Ethereum (ETH).
He explained that he is already accepting registration procedures from institutional investors such as hedge funds and banks. The company plans to start providing custody services in the first quarter of 2024 (January to March), and plans to increase the number of stocks it handles in the future.
What is custody?
Refers to holding and managing assets on behalf of investors. A term widely used for assets other than virtual currencies.
Virtual currency glossary
Prometheum bills itself as “Wall Street 2.0” and is working to provide investors with an ecosystem of SEC-registered “digital asset securities.”
In May of last year, Prometheum Capital announced that it was the first company in the industry to receive certification from the Financial Industry Regulatory Authority (FINRA) as a special purpose broker-dealer (SPBD) for digital asset securities. This authorization allowed the company to provide custody services. The company is also registered with the SEC.
connection: Prometheum receives first approval from US authorities as custodian of digital asset securities
Looking ahead, the company plans to start providing trading and clearing services to individual and institutional investors within 2024. The company also plans to build a platform that makes it easy for all investors to participate.
Prometheum co-chief executive officer Aaron Kaplan commented on the announcement:
The new custody service, which starts with Ethereum, meets the strict regulatory and compliance standards set by the U.S. Securities Act.
Our strong commitment to compliance and investor protection is driving this important milestone and represents significant progress towards establishing a new paradigm for blockchain-based market infrastructure.
connection: U.S. lawmaker requests Justice Department and SEC to investigate Chinese company’s involvement in Prometheum, a virtual currency broker approved by regulators for the first time
Choose Ethereum
What is attracting attention for this custody service is that the company, which is registered with the SEC, has chosen Ethereum. The SEC has stated that Bitcoin is not a security, but has not made a clear decision regarding Ethereum.
Additionally, SEC Chairman Gary Gensler has previously suggested that all cryptocurrencies based on proof-of-stake (PoS) protocols are likely securities. Ethereum moved to PoS in a past upgrade.
connection: U.S. SEC Chairman Gensler “Possibility of PoS virtual currencies falling under the category of securities”
Some foreign media have reported that Prometheum Capital’s selection of Ethereum may prompt the SEC to make a clear judgment on whether Ethereum falls under the category of securities.
Chairman Gensler has also argued in the past that many virtual currency intermediaries (exchanges, etc.) need to comply with securities laws.
connection: U.S. SEC Chairman testifies to Congress at a hearing on the 12th, reiterating that “the majority of virtual currencies may be securities.”
The post Prometheum, an SEC-registered company, offers Ethereum as its first custody service appeared first on Our Bitcoin News.
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