US-based crypto finance company Circle Internet Financial Ltd has reportedly entered into an agreement to acquire SeedInvest crowdfunding firm to help startup companies raise cash with crypto. The development is in line with the company’s efforts to allow its customers to trade a wider range of digital assets. The proposed acquisition will also help SeedInvest in its endeavor to launch digital tokens.
As of now, neither company has disclosed the terms and conditions of the deal. SeedInvest was found in 2012 with the intent to support private firms raise funds from individuals on the internet through a platform enabling prospective investors to scan through companies and pick one to invest. The company provides equity-crowdfunding service to its customers as well as investors through SI Securities LLC, the broker-dealer of the company.
The deal, subject to the approval of the regulators will enable Circle to provide services similar to that of SeedInvest but through crypto assets. The digital asset exchange operator will be able to list tokens as securities which is much needed especially at the time when authorities tighten up the scrutiny related virtual currency.
Jeremy Allaire, Circle’s Chief Executive Officer was reported saying that Circle has been in the forefront working with the government to find out ways to help people increase funds. He further said that cryptocurrency in the future may take up a greater role in the crypto-security market and every company is likely to adopt the crypto securities similar to business websites which are nowadays owned by almost every company.
According to the US Securities and Exchange Commission (SEC), most of the coins are securities which make it clear for issuers to have the obligation to register and obey with the laws laid by the federal government as well as the platform that deal with the crypto trading. These types of regulatory scrutiny are already applied to publicly traded blockchain stocks. SEC until now has not made any comments on the recent Circle and SeedInvest deal and is likely to make a comment on the deal later in the future.
In June, Circle allegedly unveiled its plans to take up the role of a brokerage as well as the trading venue after officially registering for the same. Circle, however, is not alone in taking up much bigger role. In the same month, Coinbase Inc expressed its interest in buying a broker-dealer; whose purchase is awaiting approval from the higher authorities. A similar announcement was also made by crypto exchange Uphold in June itself.
Talking about the acquisition on the successful completion of the deal, SeedInvest will bring 30 employees to Circle, as reported in the press release. Ryan Feit, SeedInvest CEO has secured nearly $1 million and has supported startups in raising more than $120 million.
In an interview, Jeremy Allaire, Circle Chief Executive Officer mentioned that the company is more focused towards the methods adopted for the tokenization rather than focusing on the methods or procedures adopted by companies to carry out ICOs.