• Sat. Jun 22nd, 2024

US Congressman Calls For Independent Probe Into SEC’s Controversial Crypto Rules

Maria Bartiromo

ByMaria Bartiromo

Jul 14, 2023

The latest report showed that a United States congressman, Ritchie Torres, has urged the government to launch a private investigation on how the country’s Securities and Exchange Commission forms and enforces securities rules on cryptocurrency.

According to the report, the SEC recently issued a Special Purpose Broker-Dealer (SPBD) to Prometheum Ember ATS, which allows it to deal in cryptocurrency-related products and services, even though the firm is not a crypto trading platform.

As expected, the action raised eyebrows as many spectators questioned the underlying protocol of the new development. According to the report, representative Torres has called for an independent investigation of how and why Prometheum has a brokerage license issued by the SEC.

The New York Democrat questioned how Prometheum, which is currently not offering crypto-related services nor has the assurance to comply with crypto rules and regulations, can have a license from the SEC to offer digital assets trading services to US citizens.

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Furthermore, Torres highlighted the possibility of the SEC acting politically by offering the SPBD permit to the firm rather than acting from genuine interest to incorporate crypto into the existing regulatory framework which it claimed.

In addition, the Rep planned to send its request to the Government Accountability Office and the Inspector General Office of the SEC, according to the report.

Torres Calls For Investigation Of Prometheum’s License

In addition, the congressman argued that Prometheum is probably a fake platform that operates just like the series of business facades reported in Russia which were created to scam people into thinking they are real platforms, whereas they are not.

Also, he added that it is hard not to think that the SEC’s Chair Gary Gensler is recently trying to politicize the ruling system of the crypto industry by deciding to approve a controversial license for Prometheum to partake in crypto trading activities without clear proof that backs the action.

Currently, the license issuance to Prometheum has been one of the trendy topics in the crypto industry for the past few weeks. According to the report, the SEC and the CEO of Prometheum Aaron Kaplan, reportedly claimed that the approval structure of the permit showcased that there is no need for new rules or laws to regulate crypto assets like Bitcoin, Ethereum, and the like.

The new development reportedly surfaced when the SEC presented Kaplan as one of its witnesses during the hearing on the virtual resources market bill in June. Kaplan claimed he testified at the request of Maxine Waters, a minority member.

However, after the testimony, the SEC received many tongue lashes from crypto enthusiasts for including Kaplan on its witness lists given the low profile of its company.

Several Entities Ask SEC To Probe Prometheum’s Activities

Several experts in the crypto community criticized Kaplan and Prometheum, stating that it does not list several of the tokens yet it has the license to offer crypto trading services, operating as an alternative trading system.

Meanwhile, Rodrigo Seira, a crypto attorney for Paradigm Capital, highlighted in a recent podcast that it is quite an irony that Kaplan has no business but holds a license.

Furthermore, the report revealed that Representative Torres’ letters serve as a reply to a request that some Republican representatives sent to the SEC CEO, Gary Gensler, and the United States Attorney General, Merrick Garland on July 10.

The letter also called for Prometheum to be probed for its supposed relationship with HashKey and Shanghai Wanxiang Blockchain Inc., which are Chinese firms. The firm is also alleged to be associated with the Chinese Communist Party, according to the report.

In addition, the Blockchain Association Trade group reportedly filed the same allegation against the firm recently. However, little or no evidence has been submitted to support the allegation against Prometheum.

According to a senior consultant in the group, Marisa Coppel stated in a letter that the crypto industry is waiting for the Securities and Exchange Commission to respond and probe the firm to smoke out the irregularities in its operation as stated in the allegations.

Maria Bartiromo

Maria Bartiromo

Maria Bartiromo is a renowned news writer and journalist, celebrated for her insightful reporting and authoritative voice. With a career spanning years, she has established herself as a trusted source of accurate and comprehensive news analysis, keeping readers informed on vital global developments.

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