The FinReg Pod Duke Financial Economics Center

Prometheum is the one firm that other crypto firms love to hate. This is because the firm’s founders and co-CEOs, brothers Aaron and Ben Kaplan, have consistently and publicly argued that most cryptocurrencies are investment contracts subject to SEC registration requirements. In this episode, Aaron Kaplan joins Lee to discuss the process Prometheum followed to receive regulatory approve to operate an alternative trading system and special purpose broker dealer, which allows the firm to offer trading, clearing, settlement, and custody of digital asset securities. Aaron also addresses the frequent criticisms leveled at his firm and offers his thoughts on the future of the digital asset industry.
Lee’s Twitter: @leereiners
 
Related Links
 
*Prometheum Receives First of Its Kind Approval From FINRA to Clear and Settle Digital Asset Securities: https://www.businesswire.com/news/home/20240110419249/en/Prometheum-Receives-First-of-Its-Kind-Approval-From-FINRA-to-Clear-and-Settle-Digital-Asset-Securities
 
*Prometheum Announces Custodial Services for Ether (ETH), Opens Account Sign Up For Institutional clients: https://www.businesswire.com/news/home/20240207966185/en/Prometheum-Announces-Custodial-Services-for-Ether-ETH-Opens-Account-Sign-Up-For-Institutional-Clients
 
*SEC may be forced to declare Ethereum a security after controversial new launch: https://fortune.com/crypto/2024/02/07/sec-prometheum-ethereum-broker-dealer-gary-gensler-coinbase/
 
*Blockchain Association Calls for Investigation into SEC Approval of Prometheum Ember Capital as Special Purpose Broker-Dealer: https://theblockchainassociation.org/blockchainassociation-calls-for-investigation-into-sec-approval-of-prometheum-ember-capital-as-special-purpose-broker-dealer/
 
*‘Crypto Communism’? Not in America: https://www.wsj.com/articles/prometheum-digital-asset-crypto-china-wanxiang-tuberville-eab5629b
 
*U.S. Senator Tuberville Asks DOJ, SEC to Investigate Crypto Broker Prometheum:
 https://www.coindesk.com/policy/2023/07/10/us-senator-tuberville-asks-doj-sec-to-investigate-crypto-broker-prometheum/
 
*Testimony of: Aaron Kaplan Co-CEO and Founder, Prometheum, Inc. Before the U.S. House of Representatives Financial Services Committee: https://docs.house.gov/meetings/BA/BA00/20230613/116085/HHRG-118-BA00-Wstate-KaplanA-20230613.pdf
 
*Agriculture, Financial Services Republicans Demand Sec Clarify Position Regarding Prometheum’s Custody Of Ethereum’s Ether: https://agriculture.house.gov/news/documentsingle.aspx?DocumentID=7749

Well Fargo was an iconic and respected American Brand. But then, in September 2016, in a settlement with the City of Los Angeles, the OCC, and CFPB, it was revealed that approximately 5,300 Wells Fargo employees had been terminated between 2011 and 2016, for sales practice violations that included opening over two million unauthorized deposit and credit card accounts. Earlier this year, Kevin Wack published a 5-part series in the American Banker that shed new details on the scandal. Kevin came on the show to talk about how the series came together and what his reporting uncovered. He also provides an update on what has happened to some of the senior executives involved in the scandal and shares his thoughts on the enduring lessons the Wells Fargo scandal provides.
Leave questions and comments at lee.reiners@duke.edu
Lee’s Twitter: @leereiners
Related Links
*Alarm bells, arrogance and the crisis at Wells Fargo: https://www.americanbanker.com/news/alarm-bells-arrogance-and-the-crisis-at-wells-fargo
*How Wells Fargo's Aggressive Sales Culture Took Root: https://www.americanbanker.com/news/how-wells-fargos-aggressive-sales-culture-took-root
*Wells Execs Stuck to the Script as Evidence of Sales Abuses Mounted: https://www.americanbanker.com/news/wells-execs-stuck-to-the-script-as-evidence-of-sales-abuses-mounted
*Deal to put ex-Wells Fargo executive behind bars sends tough message: https://www.americanbanker.com/news/deal-to-put-ex-wells-fargo-executive-behind-bars-sends-tough-message
*The Rise and Fall of Wells Fargo with Dick Kovacevich: https://open.spotify.com/episode/7f2D7PL9ZM1zLlnNCneK0L
*Wells Fargo Unauthorized Account Openings: A Case Study for Bank Board Directors: https://sites.duke.edu/thefinregblog/2017/04/26/phony-accounts-scandal-a-case-study-for-bank-board-directors/  

James Wigginton has thought deeply about economic power and the role cooperatives can play in ensuring Web3 lives up to its stated potential of sharing ownership with users in digital networks. James joins Lee to discuss how cooperatives can be used by Web3 firms to engage with their users, strengthen digital networks, and remain compliant with securities laws. James also talks about the potential for sports fans to own a part of their favorite teams by allowing cooperatives to take minority stakes in teams.
Leave questions and comments at lee.reiners@duke.edu
Lee’s Twitter: @leereiners
Related Links
*Cooperatives: An Ownership Model for Digital Networks: https://media.orrick.com/Media%20Library/public/files/insights/2023/cooperatives-path-to-compliance-for-web3.pdf
*Can fan-owned cooperatives change the relationship between fans and owners for the better? https://theathletic.com/4783026/2023/08/17/fan-cooperatives-sports-ownership/?access_token=13946098

Alicia Seiger is a lecturer at Stanford Law and the managing director of Stanford’s Sustainable Finance Initiative. And Marc Roston is the founder of investment advisory firm MNR Capital and a senior research scholar at Stanford University’s Steyer-Taylor Center for Energy Policy and Finance. In this episode, Alicia and Marc offer their perspective on the problems with the current method of corporate carbon counting, known as the Greenhouse Gas Protocol. They also break down a new carbon accounting methodology they’ve developed called Emissions Liability Management, or ELM.
Leave questions and comments at lee.reiners@duke.edu
Lee’s Twitter: @leereiners
Related Links
*Carbon Accounting and Emissions Liability Management:
https://sfi.stanford.edu/carbon-accounting-and-emissions-liability-management
*Settling Climate Accounts: Navigating the Road to Net Zero:
 https://link.springer.com/book/10.1007/978-3-030-83650-4
*Accounting for Climate Change:                                                                https://hbr.org/2021/11/accounting-for-climate-change

Tony McLaughlin is Managing Director for Emerging Payments & Business Development at Citi Treasury & Trade Solutions. In this episode, Tony offers his thoughts on the latest developments in payments, including stablecoins, central bank digital currency, and FedNow. He also breaks down an exciting new project he’s been working on, called the Regulated Liability Network (RLN). RLN envisions a regulated Financial Market Infrastructure that could deliver an interoperable network of all facets of the sovereign currency system: central bank money, commercial bank money, and e-money (and in the future, regulated stablecoins).
Leave questions and comments at lee.reiners@duke.edu
Lee’s Twitter: @leereiners
Related Links
*The Regulated Liability Network Whitepaper                  https://regulatedliabilitynetwork.org/wp-content/uploads/2022/11/The-Regulated-Liability-Network-Whitepaper.pdf
*Regulated Liability Network U.S. Proof of Concept Findings https://www.rlnuspoc.org/home#subpage/introduction/section/w3rk7

Joe Davis is chief economist at Vanguard as well as the global head of Vanguard Investment Strategy Group. In this episode, Joe offers his thoughts on what’s driving inflation, how the Federal Reserve is likely to respond at their upcoming policy meeting and beyond, and how investors can insulate their portfolio from inflations pernicious effects. Joe and Lee also reflect on key lessons learned from the last 15 years of economic policymaking.
 
Lee’s Twitter: @leereiners
GFMC Twitter: @DukeGFMC
 
Related Links
 
*Ukraine and the Changing Market Environment* Vanguard https://advisors.vanguard.com/insights/article/ukraineandthechangingmarketenvironment
 
*Why Do We Think That Inflation Expectations Matter for Inflation? (And Should We?)* Jeremy B. Rudd
https://doi.org/10.17016/FEDS.2021.062
 
*Will Inflation Stay High for Decades? One Influential Economist Says Yes* Wall Street Journal https://www.wsj.com/articles/inflation-high-forecast-economist-goodhart-cpi-11646837755