Keystone Today

Republicans from the House Committee on Agriculture and House Financial Services Committee, including Chairmen Glenn "GT" Thompson and Patrick McHenry, have raised concerns over Prometheum Inc.'s decision to provide custody services for Ethereum's Ether (ETH) through its subsidiary, Prometheum Ember Capital LLC.

In a letter addressed to SEC Chair Gary Gensler, the lawmakers emphasized the need for clarity on the SEC's stance regarding a Special Purpose Broker Dealer's ability to custody non-security digital assets, specifically ETH. They highlighted the SEC and CFTC's previous recognition of ETH as a non-security digital asset and expressed worries about the potential consequences of allowing Prometheum to proceed with its custody services.

The letter addressed to Chair Gensler stated, "Despite your insistence that most digital assets are ‘digital asset securities,’ that term continues to be undefined." The lawmakers also pointed out Gensler's reluctance to acknowledge ETH as a non-security digital asset, further adding to the confusion surrounding asset classification in the digital asset marketplace.

The Republicans urged the SEC to provide clear rules and guidance for the digital asset ecosystem to avoid exacerbating uncertainty. They noted the SEC's previous enforcement actions against digital asset trading platforms and emphasized the importance of establishing a regulatory framework to address the classification of digital assets.

The letter to Chair Gensler concluded with a call for the SEC to clarify its position on SPBD custody of non-securities, address SPBD non-compliance, define the regulatory classification of ETH, and provide insights into the SEC's stance on Prometheum's announcement.

The full letter to Chair Gensler can be accessed for further details on the Republicans' demands and concerns regarding the custody of Ethereum's Ether by Prometheum.