Webull shares tumbled more than 18% on Wednesday after CNBC reported that a US congressional panel had found the online trading platform was “tied in structural ways” to the Chinese government.
The bipartisan House Select Committee on China identified “a profound gap” between Webull’s public marketing and the reality of how the company is controlled, according to a report scheduled for release on Wednesday.
The committee found that Webull’s corporate structure—including its “software development, data pipelines, and core engineering operations”—relied on infrastructure directly subject to Chinese laws, CNBC reported.
The stock fell to its lowest level in nearly four months and was on course for its steepest one-day percentage decline since April last year if the losses held.
Webull, the House committee and a spokesperson for the Chinese embassy in the United States did not immediately respond to Reuters’ requests for comment.
“The potential regulatory and operational implications of these findings create a level of uncertainty that we cannot reasonably incorporate into our estimates,” Siebert Financial analyst Brian Vieten said as he suspended his buy rating and price target on the stock.
The findings highlight increasing scrutiny in Washington of Chinese links to companies operating in strategically important areas of the US economy, including financial services.
Last week, Democratic Congressman Ro Khanna warned that Beijing could steal AI model weights developed by OpenAI, Anthropic and other leading US companies, potentially eroding America’s technological advantage over China.
US President Donald Trump’s three-day summit with Chinese President Xi Jinping last month also produced no breakthroughs on contentious issues including artificial intelligence, trade, Taiwan and the war with Iran.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)
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US stocks: Webull shares plunge 18% after report flags structural ties to China
Webull shares fell by more than 18% following a report connecting the platform to the Chinese government. The House Select Committee on China revealed discrepancies between Webulls marketing and its operational reality. Concerns were raised about the companys reliance on infrastructure subject to Chinese laws. Analysts expressed uncertainty about the regulatory implications affecting the stock's…
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