Webull sinks after CNBC reports US House panel flagged China ties

Webull's shares fell more than 18 percent on Wednesday after CNBC reported that a US congressional panel had found the online trading platform "tied in structural ways" to China's government.

The bipartisan House Select Committee on China, in a report set to be released on Wednesday, found "a profound gap" between the company's public marketing and actual control, the report said.

• The committee said the company's corporate structure, including "software development, data pipelines, and core engineering operations", was dependent on infrastructure subject directly to Beijing's laws, according to the report. 
• Stock hit its lowest in nearly four months and was on course for the biggest one-day percentage decline since April last year, if current levels hold.
• Webull, the House committee and a spokesperson for the Chinese embassy in the US 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, while suspending his buy rating and price target on the stock.
• The House committee's findings underscore the growing scrutiny in Washington of Chinese links to companies operating in key areas of the US economy, including financial services.
• Last week, Congressman ⁠Ro Khanna, a Democrat, warned that Beijing could steal AI model weights ‌developed by OpenAI, Anthropic and other top US firms, erasing the US edge over China.
• US President Donald Trump's lavish three-day summit last month for Chinese President Xi Jinping also delivered no breakthroughs on thorny issues such as AI, trade, Taiwan and the war with Iran.

Reuters

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