Blockchain Association Demands Probe into Prometheum Over Suspected SEC ‘Favoritism’


The Blockchain Association, a U.S.-based crypto advocacy group, has submitted a letter to the Securities and Exchange Commission’s Office of Inspector General, calling for an investigation into crypto firm Prometheum. The July 12 letter raises concerns about the Financial Industry Regulatory Authority’s approval of Prometheum’s special purpose broker-dealer license (SPBD) in May 2023, as well as the means by which co-CEO Aaron Kaplan secured a seat to testify before the U.S. House Financial Services Committee in June.

The association claims that the SPBD license was granted in spite of the uncertainties surrounding U.S. securities laws pertaining to crypto firms. They also allege that Prometheum changed its position on regulatory clarity from the SEC in April 2021, to claiming that there is a “clear pathway to registration for digital assets and legislation is unnecessary”.

The Blockchain Association also expresses concern that the SEC is granting Prometheum a “sweetheart deal” in return for their support of the Commission’s policy goals, and worries that SEC Chair Gensler is using Prometheum and the SPBD licensure process as a way to impede congressional efforts to pass legislation.

The call for an investigation into Prometheum follows a Freedom of Information Act request from the association in June, seeking documents and communications related to Prometheum’s license, but the group is still awaiting answers. Meanwhile, several U.S. lawmakers have called for a Department of Justice and SEC investigation regarding the firm’s alleged ties to China-based companies, which appears to be unrelated to the allegations made by the Blockchain Association.

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