Prometheum Classifies Uniswap's UNI and Arbitrum's ARB Tokens as Securities, Stirring Controversy

This move, which expands the firm's custodial services to include these tokens along with Ether (ETH), reflects a broader regulatory struggle within the cryptocurrency sector.

U.S.-registered digital asset firm Prometheum has classified Uniswap’s UNI and Arbitrum’s ARB tokens as securities, expanding the firm’s custodial services to now include these tokens along with Ether (ETH).

On August 21, Prometheum announced that it will add UNI and ARB to its custody platform, treating them as “digital asset securities.” This decision will roll out in the third quarter of the year, offering institutional clients custodial services for these tokens.

We’re excited to announce the addition of the following #digitalassetsecurities, Uniswap (UNI) and Arbitrum (ARB), to the Prometheum Capital custodial platform.

Institutions and corporates will be able to custody Uniswap (UNI), Arbitrum (Arb) and Ethereum’s Ether (ETH)

Prometheum Capital, the specialized broker-dealer arm of the firm, is said to be the only SEC-qualified custodian and broker-dealer for digital asset securities.

This classification aligns with the SEC’s interpretation but diverges from the prevailing industry perspective. Prometheum’s classification of Ether as a security mirrors its earlier decision, which has been met with mixed reactions.

Arbitrum and Uniswap Tokens Classification Raises Eyebrows

Prometheum’s decision to treat UNI and ARB as securities positions the firm counter to many in the cryptocurrency space. Uniswap Labs, for instance, has strongly contested the SEC’s classification of UNI.

The decentralized exchange maintains that UNI is not a security and should be treated analogously to Bitcoin (BTC) and ETH, which some regulators classify as commodities.

Seen in the broader context, this classification highlights the heated regulatory debate unfolding in the U.S. Several major crypto firms, including Coinbase and Ripple, are actively challenging the SEC’s approach.

These firms advocate for the classification of digital assets as commodities or digital goods, rather than securities. This ongoing conflict creates uncertainty in the regulatory outlook for cryptocurrencies in the United States.

Regulatory Concerns and Future Implications

The regulatory landscape for digital assets grows more complex as different U.S. regulatory agencies hold varying viewpoints.

For example, the Commodity Futures Trading Commission (CFTC) has classified Ether as a commodity, highlighting the jurisdictional overlap with the SEC. This misalignment between regulatory authorities adds another layer of complexity for cryptocurrency firms.

Prometheum’s classification of UNI and ARB as securities demonstrates its alignment with the SEC’s regulatory framework. Prometheum is positioning itself as the only firm officially recognized as a broker-dealer for crypto assets.

However, this role comes with its own set of challenges. The firm’s conservative approach may put it at odds with the industry narrative and potential legislative developments.

Prometheum’s inclusion of UNI and ARB in its custodial services showcases the firm’s adherence to a strict compliance strategy. While this choice aligns with the SEC’s vision, it has sparked significant discussion within the cryptocurrency sector.

The outcome of ongoing legal battles and regulatory discussions will likely determine the future landscape for cryptocurrencies in the United States.

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