From time to time in recent months, the Securities and Exchange Commission has felt compelled to weigh in on the special purpose acquisition company boom, generally in an unfavorable way, and often prompted by some or other head-scratching or slamming-into-a-brick-wall novelties appended to the general novelty of the blank-check company itself. And, well, the SEC has something else to say about SPACs.

Speaking at a legal conference Wednesday, Securities and Exchange Commission official John Coates said there are “some significant and yet undiscovered issues” with SPACs…. Those issues are “not something that’s going to stop them by any means, but they are relatively as yet incompletely worked through mechanisms, despite the fact they have been around for a while,” said Mr. Coates, who is acting director of the SEC’s Corporation Finance division…. “Their current surge is bringing the level of attention by many more participants in the market than previously had been involved, and that is turning up some questions that have to be thought through more carefully,” said Mr. Coates, who spoke at a legal conference sponsored by the Practising Law Institute.

Coates didn’t elaborate on those issues or questions or what prompted them, but we can’t help thinking that a trading card company mumbling something or other about NFTs taking advantage of the SPAC route at the moment at which both the SPAC craze and bored hunger for spending your money on crap abate as the pandemic subsides and people are mercifully able to do something else with their lives might have something to do with it.

Topps, which is best known for its baseball cards and Bazooka candy line, has agreed to go public through a merger with Mudrick Capital Acquisition Corporation II, a special purpose acquisition company, that values Topps at $1.3 billion…. While Topps is best known for its sports trading cards, it has branched out into interactive mobile apps to connect collectors and recently expanded into nonfungible tokens…./“This is the icing on the cake, going digital completely, with the analog still in place,” [Topps Chairman Michael] Eisner said.

A more perfect nutshelling of this deal than that perfectly meaningless and self-contradictory statement we certainly can’t imagine. It must be nearly impossible for the folks at Patreon to hold themselves from taking advantage of these rubes while they still can.

And speaking of getting in a little late, Jim Cramer thinks it’s a great idea for at least two companies.

“If you care about the future of either company or the long-term trajectory of their stocks, issuing shares up here is the right move,” Cramer said. “But the ‘hold the line’ crowd they hate these offerings … and they despise anyone who defends them….”

“AMC and GameStop need money,” Cramer said. “Raising capital is good for both companies and over the long haul, what’s good for the company should be good for the stock.”

For now, let’s give the last word to Carson Block, who ties these storylines together quite nicely.

"You've got the companies that are really deserving of being shorted, and then you've got the companies that you actually can short from a technical perspective. A lot of the intersection right now is SPACs."

Topps to go public through SPAC deal as baseball card company ventures into NFTs [CNBC]
SEC Official Warns on Growth of Blank-Check Firms [WSJ]
Patreon’s Valuation Triples to $4 Billion as Platform Draws Creators, Fans [WSJ]
Cramer says AMC, GameStop plans to sell more shares will be good in the long term [CNBC]
Short-seller Carson Block discussed GameStop, SPACs, and Archegos in a recent interview. Here are the 10 best quotes. [BI]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

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