The US Securities and Exchange Commission (SEC) has been the subject of two separate and independent investigations at the request of Representative Ritchie Torres (D-NY) into its handling of digital assets.

Torres has raised concerns about the SEC’s decision to grant Prometheum Ember ATS a special purpose broker-dealer (SPBD) license. This platform has a license to act as a cryptocurrency exchange, but is not currently engaged in this activity and may not be able to do so in accordance with current regulations.

The congressman has questioned whether the issuance of Prometheum’s SPBD license was a political move by the SEC rather than a genuine effort to integrate digital assets into the existing regulatory framework. He criticized the SEC’s decision, calling it a “dubious decision” and an attempt by Chairman Gary Gensler to politicize the registration process.

In addition to this, Torres has called for an investigation into the SEC’s failure to create a rigorous but workable process for registering real-world digital asset platforms. He plans to send the requests to the SEC’s Office of Inspector General and the Government Accountability Office.

The issuance of the Prometheum license has become a contentious issue in the crypto industry in recent weeks. The SEC and Prometheum co-CEO Aaron Kaplan argue that this permit demonstrates that no new regulations or laws are needed for digital assets like bitcoin, ether, and thousands of other tokens.

However, a common criticism of Kaplan and his firm is that while it is licensed and operates an alternative trading system (ATS) that can trade digital asset values, it currently does not list any tokens and it is unclear how or when that would be. . able to do it.

Torres’ letters follow a request made on July 10, 2023 by Sen. Tommy Tuberville (R-Ala.) and five other congressional Republicans that Attorney General Merrick Garland and SEC Gensler investigate Prometheum for its ties to Chinese entities Shanghai Wanxiang Blockchain Inc. and HashKey and their alleged ties to the Chinese Communist Party.

Despite the anger, no solid evidence of impropriety has been produced, and ultimately there may not be any. The industry is waiting for answers and urging an investigation to uncover any wrongdoing or confirm that these inferences are without weight.

towers compared the SEC to “an overzealous traffic officer who arbitrarily tickets drivers for speeding while keeping everyone endlessly guessing about the speed limit,” adding that “regulation by police is not a way to regular”.

This development marks a significant moment in the ongoing debate over cryptocurrency regulation, and the outcome of these investigations is likely to have far-reaching implications for the industry.

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