The Blockchain Association has filed a Freedom of Information Act (FOIA) request with the Securities and Exchange Commission (SEC) to investigate Prometheum, a crypto broker. This comes after Prometheum co-CEO Aaron Kaplan testified before the House Financial Services Committee on Tuesday in support of the SEC’s positions on crypto regulation. Marissa Coppel, a lawyer for the Blockchain Association, wrote that the decision to seek more information was driven by growing suspicions around Prometheum.
In the midst of aggressive SEC enforcement, Prometheum [received] approval for first-of-its-kind Special Purpose Broker-Dealer (SPBD) for digital asset securities, Coppel wrote. The CEO somehow gets a seat in front of Congress and argues that Prometheum represents the compliant path for digital assets.
Despite self-characterizing as a fully regulated crypto exchange, Prometheum is not currently operational and there are major unanswered questions about its path forward. Coppel characterized these and other findings about Prometheum as suspicious. Analyst Adam Cochran and venture capitalist Matt Walsh raised questions about Prometheum’s business practices and relationships, including suggestions that Prometheum had obtained funding from unconventional sources and had at one point planned to launch its own token.
Andrew Bailey, Associate Professor at Singapore’s Yale-NUS College and part of the Resistance Money crypto research group, summed up three possible interpretations of the situation. Preston Byrne, a lawyer in the crypto-regulatory world, dismissed conspiratorial speculation, writing that: Aaron [Kaplan] has been working on Prometheum since at least 2015, comes from a family of lawyers … and has a view on tokens consistent with that background. There’s nothing fishy, it’s just nobody noticed him until this week.
The Blockchain Association’s FOIA request seeks to uncover the truth about Prometheum and its claims of compliance. The company couldn’t be reached for a comment as of press time.