Online brokerage Webull has decided to cut its cryptocurrency offerings due to the unfavorable regulatory landscape in the United States as it awaits approval to list on the Nasdaq via a special purpose acquisition company (SPAC), Bloomberg News reported on Feb. 28 .
The company said its previous attempt at an initial public offering (IPO) was likely blocked due to its cryptocurrency-related services. Webull attempted several initial public offerings (IPOs), but failed each time.
Anthony Denier, CEO of Webull US, said:
“For several reasons we have not been successful… I can name a few, and I think the last one is exposure to cryptocurrencies. THE [SEC has] it wasn’t friendly, which is widely known.
End of cryptographic services
According to Bloomberg, Webull sold its digital assets business and discontinued its cryptocurrency offerings at the end of the third quarter of 2023 due to the SEC’s unclear rules for registered broker-dealers working with cryptocurrencies.
The company continues to offer cryptocurrency buying and selling in partnership with Bakkt via its Webull Pay app, described as a separate business on the company’s support pages.
However, despite Webull’s concerns about SEC regulation, at least one retail brokerage with crypto services has managed to launch an IPO.
Webull’s main competitor, Robinhood, has been offering cryptocurrency trading features since 2018 and successfully completed its IPO in 2021.
Listing via SPAC
Webull currently plans to list on Nasdaq via a $7.3 billion Special Purpose Acquisition Company (SPAC) deal with SK Growth Opportunities Corp, a blank check company.
While there are various advantages, SPACs are generally considered less demanding than IPOs and notably allow for earlier valuation.
According to a press release, the deal will see SKGR common shares begin trading under a new label, while the combined company will take on the name “Webull Corporation.”
The deal has not yet been completed but awaits approval from shareholders and regulators.
