Circle’s public listing plans undeterred by latest SEC actions
Crypto advisory firm founder says current environment poses challenging IPO path for segment’s players
Circle CEO Jeremy Allaire | World Economic Forum
The latest SEC action against publicly traded company Coinbase has not deterred crypto payments tech company Circle — or others — from continuing its quest to go public.
Still, the path for most companies mulling a public listing is likely to be tough in the current environment, an industry executive said.
After revealing a plan to become a public company by merging with a special purpose acquisition company (SPAC) in 2021, Circle CEO Jeremy Allaire said in a December 2022 tweet that his company “did not complete SEC qualification in time.”
Executives said earlier this year going public remained a key part of Circle’s strategy — a plan confirmed again this week by a company spokesperson and a recent job posting.
“We are not prepared to put a specific deadline on the decision, but we will be taking steps to continue our journey to go public as soon as practicable,” a Circle spokesperson told Blockworks.
A Circle job listing posted two weeks ago for corporate counsel also makes reference to these plans.
The professional would be tasked with “assisting with potential going public SEC process” as well as “supporting the building out of our public company policies, practices and processes,” the job description states.
Circle’s plans remain despite the SEC’s latest lawsuit against Coinbase, which has been a public company for more than two years.
Coinbase went public in April 2021 after the SEC “declared effective” its registration on Form S-1 — the initial registration document for new securities. But the regulator alleged in a complaint Tuesday that Coinbase has been operating as an unregistered exchange — charges the company has denied.
Read more: Coinbase Was Allowed to Go Public, Then Got Sued — Hypocrisy? Not Really, Some Say
“Declaring effective a Form S-1 registration statement does not constitute an SEC or staff opinion on, or endorsement of, the legality of an issuer’s underlying business,” the SEC complaint states.
Galaxy Digital’s plans to go public by becoming a Delaware-incorporated company and subsequently list on the Nasdaq — reiterated in March — also remain, a spokesperson said Friday. The company’s latest amended registration was submitted to the SEC in February and is currently under review.
But the current environment could pose hurdles for most companies looking to go public, said Eric Risley, founder of crypto advisory firm Architect Partners.
“The fundamental requirements for a viable [initial public offering] is strong business momentum and a positive, or at least stable, business environment,” he told Blockworks in an email. “While each company is unique, it’s safe to conclude that neither of these requirements are present today. Until that changes, the IPO path will likely be postponed for most companies.”
Kraken job posting also hints at continued IPO plans
Crypto exchange Kraken also hinted at its continued quest to go public in a recent job posting for a senior corporate and securities counsel.
It lists “public company preparedness” as one of the matters Kraken’s legal team is focused on, adding that “public company reporting experience” is a preferred skill for candidates.
A company spokesperson did not return a request for comment.
Kraken mulling an IPO is nothing new.
A Kraken spokesperson told Blockworks in June 2021 that the crypto exchange might consider going public in 2022.
“At this point no decision has been made and we’re fully focused on scaling our business, filling key roles and making sure we’re giving clients the best experience and products in a time of unprecedented growth,” the representative added at the time.
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- 0xResearch: Alpha in your inbox. Think like an analyst.
