Currency USD (USDC) issuer Circle has denied rumors that it received a “Wells Notice” on its US dollar-pegged stablecoin.
On February 14, a now-deleted tweet from Fox Business reporter Eleanor Terrett claimed that the US Securities and Exchange Commission (SEC) had ordered Circle to cease selling USDC, because the stablecoin was an unrecorded security.
However, the rumor was quickly shot down by Dante Disparte, Circle Pay's Director of Strategy and Global Policy Director on Twitter just 15 minutes after Terrett's tweet, noting that his company has not received a Notice from Wells.
.@circle has not received a notice from Wells. https://t.co/lE74zHVLka
— Dante Disparte (@ddisparte) February 14, 2023
A Wells notice is a formal notice sent by the SEC informing a recipient that it plans to bring enforcement action against them.
In response to Circle's denial, Terrett said he "followed the word of several reliable sources" and apologized for the mistake.
Here is the answer from @circle. I took the word of several reliable sources on this. I apologize for the mistake @ddisparte. https://t.co/NjyD57PDuZ
— Eleanor Terrett (@EleanorTerrett) February 14, 2023
Dante replied to Terrett that his apology is accepted and added:
"Alas, there is a lot of turmoil, eddies and rumors informing the market at the moment."
Terrett's original tweet has since been deleted. His Twitter account of hers was temporarily deleted, but she has since returned.
CORRECTION: @circle You have not received a notice from Wells for @ddisparte and i really apologize for the mistake. I strive to do things right, but I also want to admit when I'm wrong. I'm sorry.
— Eleanor Terrett (@EleanorTerrett) February 14, 2023
Fears of regulatory action against stablecoin issuers have been running high this week after Paxos Trust Company, the issuer of Binance USD (BUSD), confirmed that he had received a notice from Wells It alleged that it failed to register the offering under federal securities laws.
Related: Stablecoins Not Targeted in BUSD Crackdown: Matrixport Research Head
When asked earlier this week if Circle had received a similar notice from the SEC on USDC, Disparte told Cointelegraph:
"Circle contends that USDC is a regulated dollar digital currency issued as stored value under US money transmission law."
“The facts and circumstances in any type of regulatory action like this are all different, as are the structural and regulatory considerations with each of the cryptocurrencies that are in circulation around the world,” he added.
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