Regulation in the crypto market recently turned a head when US lawmakers sent a clear message to the market’s regulators, the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). A Special Purpose Broker-Dealer license (SPBD) had been granted to Prometheum, and the lawmakers questioned the circumstances surrounding the issuance. Prometheum, an unheard-of entity till its co-founder testified before the House committee, has been on the receiving end of questions regarding its products and services. Even so, the firm, which was established in 2017, has yet to serve a first customer. Inquiring minds wonder if there is more to the story since FINRA approved the SPBD application of a company with no operational history.
In the same vein, the lawmakers raised furrowed eyebrows over Prometheum’s alleged ties to the Chinese Communist Party. A request has been made for SEC and FINRA to supply any communications and documents relating to the SPBD issuance. According to the lawmakers, this firm might be far from the “silver bullet for regulated digital asset offerings” it claims to be.
While Prometheum’s story unfolds, another interesting development is taking place within the United States based cryptocurrency exchange, Coinbase. The exchange has urged crypto users to “elect pro-crypto candidates”. With a strong emphasis on political affiliation, Coinbase has managed to gather over 54,000 individuals who signed up to its “Stand with Crypto Alliance” initiative.
This huge engagement from the crypto community echoes preferences concerning the policies of elected representatives. This initiative by Coinbase plays a pivotal role in advocating for the crypto cause among the US lawmakers.
However, one can’t help but question the propriety of featuring Representative David Schweikert, an acknowledged offender of House ethics rules. A closer look reveals hefty fines levied against the Arizona representative for specific campaign finance violations, casting a shadow over Coinbase’s “pro-crypto candidates” initiative. Should violations in other realms be overlooked to support politicians offering a conducive environment for cryptocurrencies?
The intertwining of politics and regulation in the crypto world can make for an unpredictable climate. Advocating for political figures based on their crypto policies might win some battles, but does it ensure overall victory for cryptocurrencies? The industry waits with bated breath as regulators, lawmakers, and market participants grapple with trust, regulation, and crypto’s place in the financial system.
Source: Cointelegraph
