The company assured that it is “cooperating fully” with the US regulator, although it did not provide details about the center of the investigation.
Circle Financial, the company behind the stablecoin USDC, is being investigated by the Securities and Exchange Commission (SEC) of the United States.
As revealed by a report from CoinDesk, the company received a “investigation summons”From the Compliance Division from the regulatory agency in July. The investigation was released through SEC public documents filed by Circle as part of your intention to go public through an agreement with a Special Purpose Acquisition Company, or SPAC.
In the documents, a presentation of Form S-4 introduced by Circle to the agency dated October 4, it reads:
[E]n July 2021, we received an investigative subpoena from the SEC’s Enforcement Division requesting documents and information about some of our properties, client programs, and operations. We are cooperating fully with that investigation.
Circle is investigated by regulators
Circle It had already advanced plans to list on the US stock market in July of this year. The language of a presentation S-4, dated August 6, already suggested that the company was under an SEC investigation, although the information went unnoticed amid coverage of the plans for Circle to go public and become “a total reserve national commercial bank ”.
The company said in at that moment that it agreed to pay the SEC more than USD $ 10 million to settle the charges of its subsidiary, Poloniex, which operated as an unregistered digital asset exchange.
In that previous document, the company used the same words to communicate the summons. None of the regulator’s documents provides more detail on the reason or the status of the investigation. The representatives of Circle They have also not provided additional information on this matter to the news media.
“Circle is cooperating in an ongoing SEC investigation. Our October S4 filing references a continuation of the July 2021 SEC subpoena previously disclosed in our August S4 filing.“, A spokesman commented to Decrypt.
In any case, as reported CoinDesk, the summons came a month after Circle will begin to incorporate USDC corporate holders into its first high-performance product, Circle Yield. In a Press release June, the company indicated that said crypto performance product was regulated by the Bermuda Monetary Authority (BMA).
SEC watches crypto industry closely
More recently, the cryptocurrency exchange Coinbase chose to abandon the launch of a very similar loan product, which was based on USDC, after receiving threats from the regulatory agency. How we report in DailyBitcoin, the SEC had warned the company that this product would violate US securities law.
The regulator’s latest actions come as no surprise given the stated goal of tightening its oversight of the cryptocurrency industry. Under the leadership of Gary Gensler, current chairman of the agency, the SEC has focused on the need for greater regulation of the industry.
Gensler, for his part, has described cryptocurrencies as a “speculative asset class”And has repeatedly championed the implementation of consumer protection laws. Last month, the SEC chairman said he wanted to lead the digital currency market “to the framework of public policies“.
Hannah Estefanía Pérez’s version / DailyBitcoin
Unsplash image edited in Canva