- Prometheum Capital is governed by the Securities and Exchange Act
- The legislation protects clients from the risk of digital asset security loss
Prometheum Ember Capital LLC, a subsidiary of Prometheum Inc., has become the first entity to receive approval from the Financial Industry Regulatory Authority (FINRA) to provide custody of digital asset securities as a special purpose broker-dealer (SPBD), Bankless Times learned from a press release.
The company may now custody digital asset securities for institutional and retail clients.
Only platform subject to SEA
Unlike all other trading platforms and crypto exchanges in the US, which only hold state licenses, Prometheum Capital is governed by the Securities and Exchange Act (SEA). Co-CEO of Prometheum, Inc. Aaron Kaplan commented:
Digital asset investors in the U.S. are currently custodying cryptocurrencies that are securities through platforms that don’t offer the same SEA 15c3-3 customer protections required by the federal securities laws. We expect that custodying assets in an SEC-registered broker-dealer will provide the regulatory protections needed to re-establish investor confidence, increase institutional adoption, and allow the industry to flourish.
First custodying by FINRA member firm
No other entity has custodied digital asset securities as a FINRA member and a broker-dealer registered with the SEC and subject to federal securities laws. The legislation entails extensive procedures and policies to protect clients and other market participants from the risk of digital asset security loss, theft, or fraud.
About Prometheum
Aaron Kaplan and Benjamin Kaplan founded Prometheum in 2017, after they realized investors in digital assets lacked protection. They set out to develop the first federally regulated, end-to-end digital asset security ecosystem. Their status as an SPBD marks a milestone in their mission to help build a more responsible and safer industry.
Prometheum ATS, which is registered with the SEC and a member of FINRA, launched in October last year, subject to federal securities laws. It enables digital asset security access and trading via integration with clients’ securities trading systems.
