Prometheum To Offer Regulated Ether Custody In US: ‘Ethereum First And Many More Thereafter’ – Coinbase Glb (NASDAQ:COIN)

Prometheum Inc., the sole crypto securities platform in the U.S. with regulatory approval, will offer custody services for Ethereum’s Ether (CRYPTO: ETH) to its clients.

What Happened: Despite facing industry scrutiny and having not yet generated revenue, co-CEOs Aaron and Benjamin Kaplan aim to begin ETH custody services by the end of the upcoming month.

“Ethereum is first, and there should be many more thereafter,” Aaron Kaplan told CoinDesk, emphasizing the desire to cater to the market’s most significant and liquid tokens.

Prometheum seeks to establish itself as a broker-dealer and crypto custodian. The company’s forthcoming alternative trading system, expected to launch next quarter, will test whether crypto operations can meet U.S. regulatory standards while offering a streamlined compliance framework compared to traditional exchanges.

This venture into regulated crypto custody and trading places Prometheum at the forefront of determining whether the U.S. Securities and Exchance Commission (SEC) will classify ETH as a security and contrast with the Commodity Futures Trading Commission’s (CFTC) classification of ETH as a commodity.

“The CFTC is not our regulator,” Ben Kaplan stated, indicating the firm’s commitment to align with the SEC’s guidance on ETH’s status.

Also Read: Trump Calls CBDCs ‘Dangerous’ And Deems AI ‘A Tremendous Security Problem’

Why It Matters: Prometheum’s initiative is drawing significant interest as a “qualified custodian,” targeting a clientele that includes asset managers, hedge funds, and banks, especially in light of recent industry upheavals.

The potential SEC rule requiring investment advisers to use qualified custodians for crypto assets could significantly boost Prometheum’s business, aligning with SEC Chair Gary Gensler‘s stance on current crypto exchange regulations.

Aaron highlighted the alignment with traditional financial firms’ compliance expectations and the opportunity in asset tokenization, which necessitates integrated trading, clearing, and settlement services.

However, the company’s path forward remains uncertain, influenced by ongoing legal debates over the classification of crypto securities and the outcome of cases like Coinbase Inc. (NASDAQ:COIN), which challenge the SEC’s definition of cryptocurrencies as securities.

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