USD Coin (USDC) issuer Circle has denied rumors that it has received a “Wells Notice” regarding its stablecoin pegged to the United States dollar.
On February 14, a now-deleted tweet from Fox Business reporter Eleanor Terrett claimed Circle had been ordered by the US Securities and Exchange Commission (SEC) to stop selling USDC – because the stablecoin is an unregistered security.
However, these rumors were quickly refuted by Dante Disparte, Chief Strategy Officer and Head of Global Policy at Circle Pay on Twitter just 15 minutes after Terrett’s tweet, stating that his company had not yet received the Wells News.
.@circular have not received news of Wells. https://t.co/lE74zHVLka
— Dante Disparte (@ddisparte) February 14, 2023
A Wells Notice is a formal notice sent by the SEC informing the recipient that it plans to take enforcement action against them.
In response to Circle’s denial, Terrett said he “used some reliable sources” and apologized for the mistake.
Here is the response from @circular. I went with the word of some reliable sources. I apologize @ddisparte. https://t.co/NjyD57PDuZ
— Eleanor Terrett (@EleanorTerrett) February 14, 2023
Dante responds to Terrett that he apologizes, adding:
“Wow, there’s a lot of churn, swirl and rumor telling the market right now.”
The original tweet from Terrett has been deleted. Her account on Twitter was temporarily deleted but has since returned.
CORRECTION: @circular have not received news Wells every @ddisparte and I apologize for the mistake. I try to correct everything but also want to admit that I am wrong. I’m sorry.
— Eleanor Terrett (@EleanorTerrett) February 14, 2023
Fears of regulatory action against stablecoin issuers have run high this week after Paxos Trust Company, the issuer of Binance USD (BUSD), confirmed it has received a Wells Notice that it allegedly failed to register its offering under federal securities laws.
Related: Stablecoins not targeted in BUSD crackdown: Matrixport research chief
Asked earlier this week whether Circle had received a similar notification from the SEC regarding USDC, Disparte told Cointelegraph:
“Circle maintains that USDC is a regulated dollar digital currency issued as stored value under US money transmission laws.”
“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 in circulation around the world,” he added.