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According to mythology, the titan Prometheus gave humans the gift of fire. As punishment, Zeus had Prometheus chained to a rock and an eagle would swoop down to eat his liver, which would then regrow overnight, for the cycle of torture to begin again the next day. 

Why the gory intro? Because Prometheum, the only crypto securities platform registered with the SEC as a broker-dealer, announced that it would start listing ETH as its first asset, with the strong implication that ETH is a security. Probably not surprising, its announcement on X that it would do so (with the hashtag #digitalsecurities, no less), was excoriated (my favorite comment “you should have turned off comments”). This may be the impetus for the SEC to officially determine that ETH is a security, which would likely cause significant turmoil in the US market for ETH (and possibly reach markets worldwide). That stance could also start a turf battle between the SEC and the CFTC, the latter having officially taken the position that ETH is a commodity. 


While it is not clear yet whether this will turn out to be a doozy or a nothing-burger,1 it certainly has the ability to become one of the more important events in the crypto space. Choosing ETH as the first product for its platform seems a risky move for a startup like Prometheum to take. It certainly generates publicity, but as the comments on X indicate, it has the potential to unleash the fury of the cryptoverse upon Prometheum’s business if it is the catalyst for the SEC to pronounce ETH to be a security. The impact of the SEC declaring ETH a security would be far reaching and could be the most significant action taken by the SEC with respect to cryptocurrencies. And if the SEC does not do so, in the words of Prometheum’s founder, it may negatively impact Prometheum: “When the SEC says to us, 'It's not a security,' then we'll be troubled.”


1 “Nothing-burger” is the modern form of the legal term “nihil est.”

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm or its clients, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.


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Anthony Tu-Sekine | Partner

As the head of Seward & Kissel’s Blockchain and Cryptocurrency Group and a frequent commentator on all things crypto, Anthony advises clients on a wide range of evolving topics, including how to structure and issue security and utility tokens, registered and unregistered offerings of security tokens, token custody, transfer and liquidity issues, non-security opinions, and investments in crypto assets by funds and other investors. A recognized leader on physical precious metals funds, Anthony represented APMEX Inc. and alternative asset manager Sprott Inc. in connection with the launch of OneGold.com, which allows investors to own gold documented on blockchain. He also:

  • Represents ShelterZoom, a leading blockchain-based SaaS contract management platform;

  • Helped form a tokenized hedge fund;

  • Provides advice in connection with ransomware payments made in cryptocurrencies; and

  • Worked with sponsors of bitcoin ETF and OTC products.

“You can work with regulators or you can really try to piss them off… If you really want to do the latter, then you should expect that they will bring every tool they have against you.”
Anthony’s thoughts on BitMEX indictment, as published in Law360 article “BitMEX Case Seen as Blessing in Disguise for Crypto Sector”