The US SEC seems not ready to allow Circle to go public

Reportedly Circle is facing significant problems from the side of the US Securities regulatory body in its plan to go publicly listed. 

The Circle is a popular Crypto company, known for its USDC stablecoin. USDC is the second-ranked stablecoin in the Crypto sector, in terms of trade volume. After the downfall of the TerraUSD stablecoin in May 2021, this stablecoin grabbed significant support in the Crypto market because this company was fully confident with its back-end reserved funds. 

As we know since July 2021 Circle is planning to become a publicly listed company and for this purpose, the company negotiated a new deal with a special purpose acquisition company (SPAC) Concord Acquisition Corp., To bring the company’s valuation to a better level. In July 2021, the valuation of Circle was nearly $4.5 billion and the report noted that the company saw an increase in its valuation by 100% to Feb 2022.

On 5 Dec 2022, Circle CEO Jeremy Allaire again talked about the company’s plans to go public and confirmed that the company failed to complete the deSPAC transaction within the given time frame, which was a kind of failure for the company to comply with the standards of the United States Securities and Exchange Commission (SEC).

1/ Some big @circle news. This morning, we announced the termination of our proposed deSPAC transaction. While disappointing that we did not complete SEC qualification in time, we remain focused on building a long-term public company. https://t.co/R0XYfCFD54

— Jeremy Allaire (@jerallaire) December 5, 2022

In a recent report from FT, Circle company talked about the main issue and noted that the Crypto market downfall or fear among the Crypto investors are regardless  points in the plan to go public. 

The company noted that its plan failed because of the abandonment of its SPAC deal.

Company stated:

“The business combination could not be consummated before the expiration of the transaction agreement because the SEC had not yet declared our S-4 registration ‘effective.”

Here S-4 registration is a type of regulatory approval from the US SEC agency to issue shares corresponding to the company’s valuation. 

Coindesk media talked about this FT report from a Circle spokesperson and confirmed that there was no fault from the SEC or any other body over its mutual termination of the SPAC merger agreement with Concord.

Read also: Struggling Crypto platform Digital Surge will pay back up to 100% of funds