Prometheum Co-CEO Aaron Kaplan Discusses Digital Asset Market Structure at FIA Conference

May 21, 2024

John Lothian

John Lothian

Executive Chairman and CEO

BOCA RATON, FL (JLN) — Aaron Kaplan, co-CEO and co-founder of Prometheum, shared his insights on the evolving landscape of digital assets and the integration of blockchain technology into market infrastructure during an interview with John Lothian News at the FIA International Futures Industry Conference in Boca Raton, Florida. This interview is part of the JLN Industry Leader video series sponsored by Wedbush.

Kaplan emphasized the potential benefits of integrating distributed architectures, such as blockchain, into market infrastructure. “I think it’s very interesting to see the more established players discussing the regulated side of digital assets and the potential applications and benefits of integrating distributed architectures into market infrastructure,” Kaplan said. He highlighted that such integration could streamline processes and eliminate unnecessary layers in the current market infrastructure.

When asked about Prometheum’s proposal to custody Ether as a digital asset security, Kaplan explained the strategic focus on supporting the largest and most liquid digital assets. “The goal is to be able to support the largest and most liquid digital assets. It’s been said that Bitcoin is not a security. So then you start from number two and go there. Ethereum is number two,” he said. Kaplan said he believes that the majority of digital assets, including Ethereum, should be considered securities.

Kaplan also discussed the broader category of digital assets, which includes investment contracts and tokenized securities. “Tokenization is really just securities on a blockchain. And you need an ecosystem licensed under the securities laws for digital assets in order to be able to support those assets,” he explained. Prometheum aims to be a comprehensive ecosystem that can support public trading, clearing, settlement, and custody of tokenized assets, he said.

Looking ahead, Kaplan sees significant growth potential in the digital asset industry, particularly with the integration of distributed architectures. “The integration of distributed architectures into market infrastructure, I think, is really the future of markets,” he said. Prometheum is positioned as a leader in this integration, offering an ecosystem licensed for digital asset securities, which includes equities, debt, options, and more, he said.

Addressing the needs of institutional investors, Kaplan noted the importance of regulatory compliance and robust market infrastructure. “Institutions really sort of embrace the space now that they have the ability to generate revenues through things like the Bitcoin ETF,” he said. Prometheum’s ecosystem is designed to ensure that tokenized assets can be publicly traded, cleared, settled, and custodied, providing the necessary infrastructure for institutional participation.

Kaplan outlined Prometheum’s roadmap, which includes adding additional assets and introducing trading for both institutional and retail investors. “You will be able to add additional assets. And the next step is actually to introduce trading first institutional and then retail,” he said. This development aims to create a compliant ecosystem for digital assets, facilitating broader adoption by institutions and retail investors alike.

In conclusion, Kaplan highlighted the growing adoption of tokenization and the need for robust infrastructure to support it. “Overall, what you’re seeing is major adoption there, and you have to have the rails to be able to support that adoption,” he said. Prometheum is committed to enabling the public trading of tokenized assets and ensuring they are liquid and can be efficiently traded, he said. 

Crisis memory, geopolitics and the risks of financial contagion

Crisis memory, geopolitics and the risks of financial contagion

First Read Hits & Takes John Lothian & JLN Staff When Jack A. Wing died in 2011, I realized the industry was losing some of the pioneers of the financial futures era. Wing founded the masters program in financial engineering at the Illinois Institute of Technology,...

We visit more than 100 financial news websites daily (Would YOU do that?)

The Spread

Todays  Options Newsletter

The Stock Market Has Rarely Been This Sleepy

Lead Stories The Stock Market Has Rarely Been This Sleepy Gunjan Banerji - The Wall Street Journal It's eerily calm out there in the stock market. The Cboe Volatility Index, or VIX, dropped below 12 last week, a nearly five-year low. The gauge, based on options prices...

Now Read This

John Lothian: Week in Review (June 17-21, 2024)

John Lothian: Week in Review (June 17-21, 2024)

JLN PRESS ROOM PICK OF THE WEEK

Opinion: Class-Action Lawsuit Against CME Group Holds Disruptive Potential to Membership Prices, Future Deals and CME Leadership

A long-standing certified class-action lawsuit against CME Group, filed by members of the Chicago Board of Trade and Chicago Mercantile Exchange, poses a potential threat to the exchange group’s membership market. A mediated settlement, encouraged by the judge, could reshape how trading rights are offered at the exchange and potentially benefit a class of shareholders, whose B-shares have declined while A-share values rose.

ASEAN exchange leaders discuss transition finance and the economic shift to net zero

ASEAN exchange leaders discuss transition finance and the economic shift to net zero

In a recent roundtable on transition finance with the World Federation of Exchanges (WFE), JLN spoke with three dynamic leaders representing exchanges from the Association of Southeast Asian Nations (ASEAN), all members of the World Federation of Exchanges. Speaking with us were Dr. Soraphol Tulayasathien, senior executive vice president, Stock Exchange of Thailand (SET); Dr Hezri Adnan, current director, group sustainability of Bursa Malaysia; and Laurent Poirot, head of product strategy and development at SGX. Contributing to the conversation were Nandini Sukumar, CEO of the WFE and Victoria Powell, senior manager – ESG, regulatory affairs for the WFE.

Regulatory Uncertainty Clouds Options Market Innovation

Regulatory Uncertainty Clouds Options Market Innovation

David Dooman, head of options at Dash Financial, a subsidiary of ION Group, expressed concerns about the impact of regulatory uncertainty on the options markets during an interview at the Options Conference in Asheville, NC.  Dooman highlighted several key issues stifling innovation and offered recommendations to address the industry’s challenges.

John Lothian: Week in Review (June  10-14, 2024)

John Lothian: Week in Review (June 10-14, 2024)

JLN PRESS ROOM PICK OF THE WEEK

The role of the FCM: Futures Discovery EP 10

Today, we’re immersing ourselves in a detailed exploration of the pivotal role of Futures Commission Merchants, commonly known as FCMs. These financial intermediaries play a crucial role in facilitating futures and options trading, serving as a linchpin in the complex web of derivative markets. Understanding the intricate responsibilities and functions of FCMs is essential for navigating the dynamic landscape of modern financial systems.