Prometheum subsidiary Prometheum Ember Capital has been granted approval by the Financial Industry Regulatory Authority (FINRA) to operate as a special purpose broker-dealer (SPBD) for digital asset securities. As a qualified custodian per the United States Exchange Act of 1934, Prometheum is now authorised to store digital asset securities on behalf of both institutional and retail clients.
Prometheum is the first firm to receive FINRA’s designation as an SPBD and provide digital asset custody as a qualified custodian. While other digital asset custody providers hold state licenses, FINRA is the self-regulatory body of the US securities industry.
Prometheum Ember Capital will offer custody services to institutional and retail customers. Individual investors can join a waitlist via the firm’s website. According to Prometheum co-CEO Aaron Kaplan:
“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.”
The US Securities and Exchange Commission (SEC) has been closely monitoring traditional investment companies and crypto firms offering digital asset custody services. New SEC rules may demand crypto firms to relocate their custodied assets to a separate entity. These proposals have faced controversy among the crypto community and politicians.
Another Prometheum subsidiary, Prometheum ATS, is authorised by FINRA to provide alternative trading services, including digital asset securities trading, clearing, settlement, and custody. This service, which launched in October, aims to combine regulated digital asset trading with legacy trading systems. Prometheum partnered with Anchorage Digital Bank for the service, which caters to institutional and retail investors alike.
Related: Anchorage Digital opens up DeFi voting for custody clients
Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?
Prometheum Ember Capital has made history as the 1st SEC-registered broker-dealer and FINRA member firm approved to operate as a Special Purpose Broker-Dealer (SPBD) for digital asset securities. Learn about how we continue to move the industry forward: pic.twitter.com/kCySyPg9Qe
— Prometheum (@PrometheumInc) May 23, 2023