Online brokerage Webull decided to limit its crypto offering due to the unfavorable regulatory landscape in the US as it awaits approval to list on Nasdaq through a special purpose acquisition company (SPAC), Bloomberg News reported on February 28.
The company said its previous attempt to conduct an initial public offering (IPO) was likely blocked due to its crypto-related services. Webull has attempted several initial public offerings (IPOs) but failed each time.
Webull’s US CEO Anthony Denier said:
“We weren’t successful for a variety of reasons… I can name a few, and I think the latest is exposure to crypto. The [SEC has] has not been kind, which is common knowledge.”
End of crypto services
According to Bloomberg, Webull has sold its digital asset business and shut down its crypto offering at the end of the third quarter of 2023 due to the SEC’s unclear rules for registered broker-dealers working with crypto.
The company continues to offer crypto buying and selling through the Webull Pay app in partnership with Bakkt, which is described as a separate company on the company’s support pages.
Despite Webull’s concerns about SEC regulation, at least one retail brokerage offering crypto services has managed to launch an IPO.
Webull’s main competitor, Robinhood, has been offering crypto trading features since 2018 and successfully completed its IPO in 2021.
Listing via SPAC
Webull is currently planning to list on Nasdaq through a $7.3 billion special purpose acquisition company (SPAC) deal with blank check company SK Growth Opportunities Corp.
Although there are several advantages, SPACs are generally considered less demanding than IPOs and, in particular, allow for upfront valuation.
According to a press release, the deal will result in SKGR common stock trading under a new ticker label, while the combined company will adopt the name “Webull Corporation.”
The deal has not yet been completed, but is awaiting shareholder and regulatory approval.
