U.S. Lawmakers to Investigate the SEC Approval Process

U.S. Republican lawmakers are closely examining how the Securities and Exchange Commission (SEC) approves crypto businesses.

The leader of this group, Patrick McHenry, along with 23 others, have written a letter to the SEC's Gary Gensler. They want to know why Prometheum got approved to work in crypto.

Prometheum is a company that offers a system for creating, selling, and trading digital tokens in a way that follows official rules. The company got special permission to deal with digital money-related securities, This drew the attention of lawmakers to the approval process of the SEC.

They are interested in Prometheum's role as a special company dealing with crypto securities. The SEC made rules in December 2020 for these kinds of companies. Until May 17, 2023, no company had gotten this approval. But now, Prometheum Ember Capital has, and this worries some lawmakers.

These lawmakers also think the timing of this approval is strange. They think the SEC might be trying to show that current rules are enough and that new laws aren't needed. Even though Prometheum says it has a complete solution for crypto, it hasn't had any customers yet.

There are also questions about which digital assets Prometheum will support. The SEC hasn't clearly said what they consider a digital asset, so it's hard to understand what Prometheum will do.

There are also worries about Prometheum's connections to China. In 2018, they worked with a Chinese company. Even though they aren't working together now, a person from that Chinese company is still a director at Prometheum.

Now, these Republican lawmakers want answers from the SEC about why Prometheum got approved. This might change how the SEC looks at crypto businesses in the future.