Blockchain Association Demands Information on Prometheum Following ‘Questionable’ Approval

United States Crypto Lobby Group Files Request for Information on Prometheum

The United States crypto lobby group, Blockchain Association, has submitted a formal request to the U.S. Securities and Exchange Commission (SEC) to obtain information regarding the relatively unknown cryptocurrency company, Prometheum.

Prometheum gained significant attention within the crypto industry when its CEO, Aaron Kaplan, testified at a House hearing in support of regulating crypto under securities laws and the SEC. This position sharply contrasts with the viewpoints of other prominent industry advocates.

On June 15, Marissa Coppel, counsel for the Blockchain Association, announced via Twitter that the group had filed a Freedom of Information Act (FOIA) request with the SEC. The request aims to obtain relevant documents and communications pertaining to Prometheum.

Coppel expressed suspicion about the approval of Prometheum as a special purpose broker-dealer (SPBD) for digital assets, particularly given the SEC’s aggressive enforcement actions. Additionally, she questioned how Kaplan managed to provide testimony during a congressional hearing on industry regulations.

Former SEC and FINRA Staff Members Raise Concerns

Further doubts have been raised about the background of the Prometheum team, as several members have ties to the SEC and the Financial Industry Regulatory Authority (FINRA).

Joseph Zangri, Prometheum’s chief compliance officer, previously worked as an SEC enforcement attorney in the late 1990s. Rosemarie Fanelli, the company’s chief regulatory officer, joined Prometheum in May 2021 following a nearly 14-year tenure in senior positions at FINRA, a self-regulatory organization for the U.S. securities industry.

The co-founders and co-CEOs of Prometheum, Aaron and Benjamin Kaplan, also have connections to former SEC staff. The Kaplan brothers are attorneys at the law firm Gusrae Kaplan, which was established by a former Chief Attorney of the SEC’s Division of Enforcement. Additionally, Martin H. Kaplan, a co-founder of Gusrae Kaplan, serves as a chairman for Prometheum.

While it is not uncommon for crypto companies to hire former regulatory personnel, these affiliations have raised eyebrows and prompted further scrutiny.

By seeking information through the FOIA, the Blockchain Association hopes to shed light on the circumstances surrounding Prometheum’s approval and the potential implications of its ties to former SEC and FINRA staff members.