The Securities and Exchange Commission (SEC) has expressed concerns about Circle, a stablecoin issuer, ahead of its initial public offering (IPO). According to Barron’s, the SEC raised issues about inadequate disclosures related to Circle’s stablecoin USDC. The SEC and Circle exchanged messages for almost a year, with the SEC requesting that Circle add disclosures about the potential risk of their token being classified as a security. The possibility of USDC being classified as a security by the SEC could result in potential penalties and stricter regulations for Circle. The SEC is also questioning whether Circle itself should be classified as an “investment company,” subjecting it to stricter regulations. Circle recently filed plans to relocate its legal headquarters from Ireland to the US, suggesting that it is prioritizing the US market for both its upcoming IPO and its overall growth strategy.
