Prometheum, a New York-based cryptocurrency firm, will announce the launch of custody services for Ethereum on Wednesday.
According to Fortune sources, this move could be part of the company's strategy to push regulators to classify ETH as a security.
The U.S. Securities and Exchange Commission (SEC) has refrained from taking a position on Ethereum's legal status, even while declaring more than a dozen other popular cryptocurrencies securities. But Prometheum's latest move, which it claims is a regulatory path for crypto within existing laws, could force the SEC's hand.
If the SEC does indeed declare ETH a security, Prometheum could be in a prime position when it launches its planned trading platform next quarter, even as the rest of the industry insists cryptocurrencies cannot survive without new laws, sources say.
Prometheum was founded by brothers Aaron and Benjamin Kaplan and received regulatory approval in 2021 to operate an alternative trading platform similar to the stock market, where users can buy and sell different securities.
The company attracted significant attention in mid-2023 when it announced that it had received first-of-its-kind approval from the Financial Industry Regulatory Authority (FINRA), an industry oversight body independent of the SEC, to operate as a special purpose broker for digital asset securities.
The Kaplan brothers support the SEC's assessment that most cryptocurrencies are securities.
*This is not investment advice.