Key Takeaways
- By designating Prometheum Ember Capital as an SPBD, FINRA has granted the firm qualified custodian status
- Prometheum ATS, has obtained FINRA registration, enabling the company to offer alternative trading services for digital asset securities
New York-based firm Prometheum has made history by securing the first special purpose broker-dealer license under U.S. Securities and Exchange Commission (SEC) guidelines for digital asset securities custody.
The license has been granted to its subsidiary, Prometheum Ember Capital, enabling the company to act as a qualified custodian and safeguard digital asset securities on behalf of both institutional and retail clients.
The approval by the Financial Industry Regulatory Authority (FINRA) subjects Prometheum Ember Capital to the provisions outlined in the United States Exchange Act of 1934. This designation marks a significant milestone for Prometheum, as it becomes the pioneer in offering digital asset custody as a qualified custodian, distinguishing itself from other providers who hold state licenses.
The CEO of Prometheum, Aaron Kaplan, expressed enthusiasm for the approval, highlighting the current lack of proper customer protections for digital asset investors in the U.S. Kaplan stated, “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 [Rule] customer protections required by the federal securities laws.”
Prometheum aims to address this gap by providing secure custody services that comply with federal securities laws. Prometheum Ember Capital states that it will extend its custody services to a wide range of clients, including institutional investors and individual traders. To access these services, individual investors are encouraged to sign up for a waitlist on the firm’s website.
In addition to custody services, Prometheum is committed to expanding its presence in the digital asset industry. Another subsidiary, Prometheum ATS, has obtained FINRA registration, enabling the company to offer alternative trading services for digital asset securities.
This service, launched in October, integrates regulated digital asset trading into existing legacy trading systems. Prometheum has partnered with Anchorage Digital Bank to facilitate the provision of these services to both institutional and retail investors.
The U.S. Securities and Exchange Commission has recently intensified its scrutiny of traditional investment companies and crypto firms engaged in digital asset custody. Proposed SEC rules may require crypto firms to separate custodied assets into distinct entities, a development that has sparked controversy within the crypto community and among legislators.
Prometheum’s achievement as a qualified custodian for digital asset securities marks a significant step towards its ultimate goal of offering comprehensive crypto trading services to customers. By prioritizing compliance and regulatory requirements, Prometheum states that aims to foster trust and confidence in the digital asset industry.
As the industry evolves, the role of qualified custodians in safeguarding digital asset securities will become increasingly critical, ensuring the protection of investors and the integrity of the market. With Prometheum Ember Capital leading the way, the landscape for digital asset custody and trading is set to transform, providing investors with enhanced security and peace of mind.
