Circle Cancels Plans for SPAC Merger With Concord
- Stablecoin issuer Circle and special purpose acquisition company (SPAC) Concord Acquisition have mutually ended their merger agreement.
- The deal, which valued Circle at $9 billion, would have allowed the USDC issuer to become a publicly traded company.
Shutterstock
Stablecoin issuer Circle has taken a step back in its plans to go public, with its proposed merger with special purpose acquisition company (SPAC) Concord Acquisition being terminated, Circle said in a press release on 5 December.
According to the announcement, Concord had until 10 December to consummate the “business combination” with Circle — the issuer of the second largest stablecoin by market cap, USD Coin (USDC) —- or seek a shareholder vote for an extension. The two companies, however, have decided to terminate the deal entirely, with the board of directors of both Concord and Circle approving of the move. Bob Diamond, chairman of Concord Acquisitions, said in a statement:
“Circle plays a key role in the blockchain’s disruption of financial services. I remain confident in Circle’s regulatory-first approach to building trust and transparency in the financial industry, which has never been more important, and I will continue being an advocate for the company as it continues to grow.”
While the reason behind the deal’s fallout was not included in the announcement, Circle CEO and co-founder Jeremy Allaire attributed the termination to not completing the Securities and Exchange Commission’s (SEC) qualification in time. Despite the SEC’s role in the deal timing out, Allaire noted that this kind of review was necessary to “ultimately provide trust, transparency and accountability” for major companies in crypto.
Circle first announced its plans to go public through a SPAC merger back in July 2021, when it received a preliminary valuation of $4.5 billion from Concord. The deal was later amended in February 2022, when the valuation of Circle jumped to $9 billion.
The Monday press release also noted that Circle had become profitable in the third quarter of 2022, with a total revenue and reserve interest income of $274 million, and net income of $43 million. The company said it had ended the quarter with close to $400 million in “unrestricted cash”.
- The digital ID project said Orb Operators received USDC payments as part of the project’s transitional phase after launch, and now that it is nearing its end Worldcoin will be switching to WLD payments.
- Worldcoin warned Orb Operators to check if they can claim rewards in their region as WLD are not available in the United States and “certain other restricted territories”.
Flickr
- During an interview with FT, CEO Brian Armstrong said that before the lawsuit a SEC staff member had said that all crypto except BTC was security, and should be delisted.
- When asked how he came to that conclusion, the SEC staff member reportedly said “we’re not going to explain it to you, you need to delist every asset other that Bitcoin”.
- A federal judge ruled that the sale of XRP through exchanges and algorithms did not qualify as selling securities, which could have a major impact on several SEC lawsuits.
- The institutional sale of the token, however, did violate federal securities laws, and the lawsuit between the SEC and Ripple will have to go to trial.