SEC Praises Cypto Underdog Prometheum, Winklevoss Lashes Out

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In an unexpected twist, an under-the-radar blockchain company, Prometheum, has found itself at the center of controversy after receiving unanticipated recognition from SEC Chair Gary Gensler and expressing support for existing securities laws.

And like clockwork, @GaryGensler went on record today with the Wall Street Journal saying "some have actually registered" and "there's a path forward here." That "some" he is referring to is Prometheum. A crypto company that has failed launch a product in 6yrs and that literally… pic.twitter.com/wDmF5QdtMN

But why has this sparked such widespread debate? Read on.

Winklevoss Takes on Gensler and Prometheum

Cameron Winklevoss, Co-Founder of Gemini, expressed his disbelief on Twitter when Gensler, in a Wall Street Journal interview, highlighted that some crypto companies have indeed registered, referring to the mysterious Prometheum. Winklevoss noted that despite Prometheum being in existence for six years, it has failed to launch a product and remains largely unknown within the crypto community.

Winklevoss added that the current securities laws, established in 1933, need to be updated and better suited for today’s digital realities. He warned that by insisting on applying archaic laws, the US risks being left behind, causing industry migration offshore, job loss, inhibited economic growth, and possible national security risks.

Everyone including the @SECGov knows that securities laws written in 1933 don't meet the realities of the world today. There are two choices: Update the law taking a first principles approach or be left behind.

What is Prometheum?

Prometheum, a Wall Street-based blockchain firm, was founded in 2017 by Aaron and Benjamin Kaplan. The relatively unknown company shot to fame when Aaron Kaplan testified before a U.S. House Committee, arguing for crypto regulation clarity.

Unlike other industry leaders who call for crypto-specific laws, Kaplan supports the regulation of crypto under current securities laws, a stance shared by the SEC. 

This unconventional view has led to widespread discussion and raised eyebrows within the crypto community.

Prometheum Takes A Stand 

In his testimony, Kaplan applauded the SEC as the world’s most capable financial markets regulatory agency and stated that the regulatory frameworks laid out by the SEC provide a compliant path forward for crypto in the US.

He argued that crypto exchanges and custodians must be regulated by the SEC and lambasted those not regulated as “reckless, unlawful platforms.” According to him, existing securities laws apply to cryptocurrencies, and those advocating for new crypto-specific laws are simply unwilling to comply.

“Prometheum’s stance is clear: There is a path forward for digital assets in the U.S. through the current regulatory frameworks set up by federal securities laws.”

Criticism And Debate Sparked

Prometheum’s sudden prominence and supportive stance towards existing regulations have led to widespread criticism. Many within the crypto community argue that despite being in operation for years and having regulatory approvals, Prometheum has little to show in terms of products.

Furthermore, social media is abuzz with speculation about Prometheum’s affiliations, with allegations of connections to the Chinese Communist Party due to mentions of “strategic partners and joint venturers” in a 2019 SEC filing.