The U.S. Securities and Exchange Commission (SEC) has introduced emergency guidance to ease the path for companies launching initial public offerings (IPOs) amid the ongoing government shutdown.
Under the updated rules, firms won’t be penalized for omitting the final price in their IPO prospectuses, a requirement now waived temporarily, to allow registrations to auto-become effective after 20 days.
By leveraging Rule 430A, issuers can file a registration statement with a price range instead of a fixed price. The SEC clarified that during the shutdown, it will not recommend enforcement actions against companies that omit price details from documents, so long as the registration becomes effective by law under Section 8(a) of the Securities Act.
Still, the guidance doesn’t fully remove oversight. If the SEC resumes operations before effectiveness, it may later require amendments or clarifications to registrations.
This temporary relief is timed to assist firms caught in regulatory limbo. With 90% of SEC staff furloughed, traditional IPO reviews and approvals have ground to a halt.
Several companies have filed for IPOs and may benefit under this framework, including BitGo, a crypto custody firm, alongside travel tech firm Navan Inc. and tax advisory firm Andersen Group. These firms previously faced pressure to include fixed pricing in filings — a requirement now relaxed under the new guidance.
In the crypto sector, BitGo recently filed for a U.S. IPO, revealing a sharp revenue increase in its S-1 and establishing itself as the first crypto custodian pursuing this path.
While this SEC guidance relaxes one hurdle, issuers will still need to navigate legal risks around disclosure accuracy and potential post-shutdown amendments, especially in volatile sectors like crypto. Firms proceeding under this framework should engage counsel and rigorously validate all statements before filing.
