Prometheum to add ARB, UNI to custody platform launching next month

Prometheum representatives told Blockworks they have an approval process for tokens and comply with regulatory standards

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WindAwake/Shutterstock modified by Blockworks

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Prometheum Capital has plans to add Uniswap’s UNI and Arbitrum’s native ARB to the custodial platform it intends to launch in the coming weeks, the company said Wednesday. 

Prometheum became the first company to receive a special-purpose broker-dealer license to custody digital assets in May 2023. Per the license, Prometheum is permitted to custody crypto securities. 

When asked why ETH, ARB and UNI are securities and not commodities, a representative from Prometheum told Blockworks that the company has a compliance team that reviews tokens and determines which meet the qualifications of a security. 

Read more from our opinion section: Ether is the Schrödinger’s cat of crypto

“The determination of whether a digital asset is a security or a commodity is a nuanced and complex legal matter that is ultimately within the purview of regulators,” the representative said. “Prometheum Capital’s focus is on ensuring that we comply with all applicable regulations and provide a platform for investors to responsibly participate in the digital asset space.” 

Representatives denied having any assurance from the Securities and Exchange Commission that regulators view these three tokens as securities, but added that should regulators come out with a contradicting stance, they will delist tokens and comply as needed. 

The SEC in April 2024 served Uniswap a Wells notice, which typically precedes an enforcement action. Uniswap in May moved to drop the pending action, arguing in a blog post that regulators have expanded their jurisdiction “beyond securities to all markets.”

The SEC dropped its investigation into Ethereum 2.0 in June — noting it would not bring charges related to the blockchain ecosystem’s sales of ETH as securities transactions, according to Consensys. The decision, which the Ethereum community took as a massive win and a sign the SEC in fact sees ETH as a commodity, did not deter Prometheum.

Read more: SEC seeks to regulate ETH as a security, Consensys alleges in lawsuit

The SEC in May also approved spot ETH exchange-traded funds under the rules for commodity-based trust shares, an encouraging sign for those hoping the regulator views the asset as a commodity rather than a security. 

Prometheum told Blockworks there are no plans to remove ETH from its list of available tokens. 

The firm’s approval by the SEC and Financial Industry Regulatory Authority last year came as a surprise to other crypto companies, including Robinhood, which said it had been trying to earn the same SPBD license. 

“When [SEC Chair Gary] Gensler said ‘come in and register,’ we did,” Dan Gallagher, Robinhood’s chief legal, compliance and corporate affairs officer, told lawmakers at a House hearing last July. “We went through a 16-month process with the SEC staff trying to register as a special-purpose broker-dealer and then we were…told in March that that process was over and we would not see any fruits of that effort.” 

The Blockchain Association previously called Prometheum’s license a “sweetheart deal” and four Republican Congressional leaders demanded a DOJ investigation into how and why the company got the regulatory green light. 

Prometheum co-CEO Aaron Kaplan has defended the SPBD license, saying in July 2023 that crypto firms not registered with the SEC and FINRA are “simply not willing to comply.” 

The custodial platform is set to launch by the end of next month, representatives told Blockworks. 

A modified version of this article first appeared in today’s On the Margin newsletter. Subscribe here so you don’t miss tomorrow’s edition.


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