SEC's Gensler Deserves Increased Congressional Scrutiny Regarding Crypto Regulation: U.S. Senator
Republican Legislators Call for Gensler to Explain SEC Approval Process for Prometheum
SEC Chair Gensler Highlights Urgent Need for Increased Budget Amidst the 'Wild West' of Crypto
Republicans on the U.S. congressional committee responsible for supervising the Securities and Exchange Commission (SEC) are requesting clarification from agency Chair Gary Gensler regarding the basis on which Prometheum Inc. was granted its distinct authorization to operate as a broker-dealer in the realm of cryptocurrency.
The letter, signed by 23 members of the House Financial Services Committee and spearheaded by Chair Patrick McHenry (R-N.C.), raised concerns about how the relatively obscure company managed to secure SEC registration as a specialized broker-dealer for digital assets, surpassing other applicants. Additionally, they inquired about the factors influencing the timing of this decision.
“The timing of the approval raises concerns that it was aimed at demonstrating that legislation is not needed because there is a workable regulatory framework for the custody of digital asset securities,” the statement remarked. Additionally, the legislators penned a letter to the chief of the Financial Industry Regulatory Authority (FINRA) – an organization funded by the industry responsible for establishing and upholding securities regulations under the oversight of the SEC.
The correspondence raises significant concerns about whether the SEC deliberately endorsed Prometheum as a prominent company to exemplify Chairman Gensler's stance that there's no necessity for fresh legislation to oversee and oversee cryptocurrencies in the United States. This endorsement occurred just as Congressman McHenry's committee was on the verge of forwarding digital asset legislation to the House floor. On their end, Prometheum's leadership has consistently asserted that they have been meticulously progressing through the registration procedure, following the same steps as any other company. Co-CEO Aaron Kaplan has contended that his company is committed to showcasing the correct approach to constructing a cryptocurrency platform that fully adheres to existing regulations.
“Prometheum purpose-built its technology with the goal to develop a market infrastructure for digital asset securities that is compliant with the federal securities laws,” the company said in a Tuesday statement in response to the lawmakers' campaign. “This technology will serve as a building block for a compliant and orderly digital asset securities marketplace that protects investors and serves their best interests.”
The legislators are the most recent individuals to demand increased details or inquiries regarding the abrupt emergence of Prometheum in Washington – a firm that has not engaged in any trading as of yet. Additional Republican lawmakers in both the Senate and the House have similarly pushed for heightened examination of the circumstance. Furthermore, Ritchie Torres (D-N.Y.), a Democratic representative on McHenry's committee, has formally called for an investigation by the SEC.
Source Coindesk
