Clarksville Times

Mar 26 2024

In response to Prometheum Capital's announcement of providing custody services for the digital asset Ether (ETH), Republicans on the House Financial Services Committee and House Committee on Agriculture have sent a letter to Securities and Exchange Commission (SEC) Chair Gary Gensler demanding clarification on various key issues.

The lawmakers expressed their concerns about Prometheum's intentions, highlighting the lack of transparency in the SEC's SPBD regime and the potential risks associated with custodying an asset that is recognized as a non-security digital asset by the SEC and the Commodity Futures Trading Commission. They stressed the need for clarification on the SEC's stance regarding the custody of non-securities, SPBD non-compliance, regulatory classification of ETH, and the SEC's position on Prometheum's announcement.

The letter emphasized the lawmakers' worries about the possible consequences of allowing Prometheum to proceed with its custody services for ETH, given the existing regulations that do not permit SPBD custody of non-security digital assets.

The lawmakers also pointed out the implications of the SEC's classification of ETH as a digital asset security, particularly in relation to the commodity futures markets. They raised concerns about the potential impact on ETH derivatives trading and the broader digital asset marketplace if regulatory certainty is not established.

The Republicans urged Chair Gensler to address the uncertainties surrounding ETH's classification and the regulatory framework for digital asset markets to avoid negative repercussions on market participants and the overall stability of the digital asset industry.

The full letter sent by the Republicans to SEC Chair Gary Gensler can be accessed for further details and key excerpts.