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The emergence of Prometheum, an SEC-approved crypto exchange is making the headlines. - 2
Apparently, the exchange does not have anything to offer the digital asset users. - 3
The presence of its CEO in Congress compelled people to think about the role the exchange would play.
At first, many people thought it to be Prometheus, a 2012 sci-fi movie, and many other projects. After a while, they all checked the spelling again and became sure about it. Prometheum is a new crypto exchange and it’s not just any other exchange. The Securities and Exchange Commission (SEC) has licensed this platform. It’s the first to achieve that feat while established players like Binance and Coinbase are still at loggerheads with the regulator.
This raises an important question: why did SEC give a license to this newbie? More importantly, there’s another fact that made it sort of big news. The CEO of Prometheum was present in the Congress which got everyone talking. Let’s take a quick tour and know everything about this new exchange.
Prometheum: In a Nutshell
First of all, let’s begin with the USP. Prometheum is one-of-its-kind and the first special-purpose broker-dealer. In simple words, SEC has allowed itself to trade digital asset securities. The exchange has obtained the regulator’s permission but it practically has an empty portfolio. The exchange stated that it would facilitate the trading of all types of securities but it has none of them.
How Did Prometheum Obtain its License?
Well, it might look like it, but Prometheum isn’t a new entrant in the crypto space. In fact, it has been around since 2017. While it doesn’t have any product to offer, it has $15M of funding. In addition to that, the exchange has been set up by former SEC staff. It even has a former FINRA member. FINRA is a subdivision of the SEC. Its links with the government don’t end here.
Prometheum raised about $48M from a former senior Communist Party official. Furthermore, the company that facilitated the fundraiser is affiliated with the party too. The firm’s name is Network 1 Financial Services and it has a dubious record. Like every other crypto exchange, it offers its own blockchain and token.
However, the regulatory affiliation doesn’t seem to have helped the exchange in a big way. Prometheum isn’t able to process any transaction because there’s no regulatory process in place.
What was Prometheum CEO Doing at the Congress Hearing?
The CEO made an appearance as well. According to some sources, the CEO was there for the SEC. The regulatory wanted him to justify its stance towards the regulation of cryptos. Yet, he couldn’t answer some simple questions and crypto users noticed the same. In his speech, CEO Aaron Kaplan talked about the SEC’s handling of digital assets and exchanges.
He said that the regulator provides a clear path to regulatory compliance. But he didn’t explain why the platform isn’t offering BTC or ETH for trading. The crypto community is rife with speculations now. Some are calling it a fraud while others are proposing different theories.
Probably in the future, the exchange will offer all cryptos. But will it become as popular as Binance and Coinbase? The crypto space will have to wait and see how Prometheum emerges.
Source: https://www.thecoinrepublic.com/2023/08/05/everything-to-know-about-prometheum-and-its-sec-affiliation/