Morning Roundup: October 19, 2023

At the SPAC of Dawn

Good morning! Watch this space moving forward as a roundup of evening filings as well as news nuggets to nibble on beside your morning coffee.

While crypto trading has proliferated in popularity in recent years, the state of New York has been one lucrative part of the map that crypto exchanges have had some limitations on due to regulatory structures.

Crypto firms hoping for a thaw there in the near term did not get pleasant news this morning with the announcement that NY Attorney General Letitia James has launched lawsuits against two crypto exchanges – Gemini Trust and Digital Currency Group (DCG) – accusing them of defrauding customers of $1.1 billion.

Gemini is run by Winklevoss twins Tyler and Cameron and stands accused of both shoddy auditing and failure to disclose the risk involved in crypto loans hosted on its platform. Gemini is already suing its co-defendent DCG in July alleging deceptive practices and both cases are a part of the continuing fallout from the meltdown of FTX and its affiliated Alameda Research.

More importantly for the five SPACs that have pending crypto deals and the seven de-SPACs that completed their own, AG James is seeking as a part of the lawsuit to ban both Gemini and DCG from the financial investment industry in New York.

Should that happen, one might expect a chill over attempts to expand new crypto business into the state and increased scrutiny for those applying for banking and other financial services licenses.

News and Rumors

• PR: Noventiq has entered into a Strategic Collaboration Agreement with Amazon Web Services to support one another’s efforts in servicing companies’ moves to the cloud. On May 4, Noventiq and Corner Growth Acquisition Corp. (NASDAQ: COOL) entered into a business combination agreement.
• AIN: FlyExclusive takes delivery of the first three of 30 Cessna CJ3+ charter jets to support its fractional ownership platform as it goes public with EG Acquisition Corp. (NYSE:EGGF), boosting its total fleet to 100 jets.
• PR: FlyExclusive also secured a $30 million investment from the state of North Carolina into its pilot training center and headquarters, which will include 10,000-square feet of flight simulators and more space for classrooms and air operations.
• ParabolicArc: Astra Space (NASDAQ:ASTR), which combined with Holicity in July 2021, saw its stock-split move to put it above $1 boomerang south of that threshold again on reports it plans to sell a 51% stake in its propulsion subsidiary.