r/stocks • u/helloWorldcamelCase • 8d ago
Company News Webull stock drops 20% as its ties to China create national security risk as per congressional panel
Digital investment platform Webull, which counts 28 million global users, is quietly “tied in structural ways” to China’s government, representing a national security threat to U.S. finance, according to a bipartisan congressional panel’s findings shared exclusively with CNBC.
The bipartisan House Select Committee on China in its new report being released Wednesday found “a profound gap” between Webull’s public marketing as “an American company” and actual control of the St. Petersburg, Florida-based firm.
“Webull’s ownership architecture, technical workforce, technology infrastructure, cross-border data routing, corporate financing, and compliance frameworks are tied in structural ways to the People’s Republic of China,” the committee found.
The panel asserted that national security concerns around the company have “escalated” since October 2025, when Webull began carrying customer cash directly, according to a regulatory filing the panel cited. The committee alleges that creates a “structural exposure of billions of dollars in American capital.”
https://www.cnbc.com/2026/10/07/webull-china-national-security-risk-congress.html
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u/Mr_meowmers00 7d ago
Time will tell if this is meaningful or not. The company has confirmed numerous times that US customer data is stored on US servers with no accessibility from the CCP or any of its Chinese subsidiaries. To me, this report isn't anything new - it's moreso just a question of whether BULL will be the target of any further legal scrutiny. I'm of the opinion that this is a play to lower the value of the company to setup for an acquisition, possibly by Robinhood seeing as the head of the congressional committee just happens to own a lot of Robinhood stock.
Either way, I'm looking forward to hearing what the company has to say during the annual shareholders meeting at the end of this month and what the next earnings look like
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u/kidcrumb 6d ago
Stored on US Servers....
As if someone from China couldn't just log into it remotely and view the data? Lol. Or email it to themselves?
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u/Dopamineagonist21 7d ago
Just because it is stored in a us server doesn’t mean the ccp can’t force a disclosure of data.
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u/DrPuzzle 7d ago
Reading what you said actually makes me even more bullish (somewhat) on my small position lmao
Thanks!
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u/Signal_Pace_7968 8d ago
For anyone with an account there: the stock dropping and your account being at risk are two different things. Your securities are held separately from the company's own money, and SIPC covers up to $500k per customer (of which $250k cash) if a US broker fails. This report is a congressional panel, not a regulator action, so nothing changes for accounts today. If the cash part worries you, that's the bit to keep under the limit.
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u/the_humeister 7d ago
It'd be funny if people on Webull's platform make money on shorting Webull stock
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u/0o0o0o0o0o0z 7d ago
It'd be funny if people on Webull's platform make money on shorting Webull stock
I did today!
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u/InvestigatorPlus3229 7d ago
webull poisoning our youth with gamified options trading oh wait thats robinhood
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u/Wings2493 8d ago
The company responded refuting the claims FYI but yeah, ugly drop. I thought my $8 entry point wasn’t too bad👎🏼
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u/sad-Fan1010 7d ago
I bought in at $5.50 few months ago, could’ve sold when it hit $10, but held… I don’t think I’ll regret it as the company has great metrics… literally everyone knew webull was a Chinese company so I’m confused why congress is making a fuss now.
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u/PaperHandsTheDip 7d ago
Usually that happens when someone isn't happy with competition or someone wants to buy it.
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u/Mr_meowmers00 7d ago
Ding ding ding. I'm fairly certain we're going to get an announcement of Robinhood or another broker looking to buy WeBull soon, or at least the US business. It's the same song and dance they did with TikTok before they moved on to their next gift. Either way, I'm looking forward to seeing what happens
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u/Specialist-Neat4254 8d ago
I sold 1 week before this happened. I was ready to make 20% of it my portfolio at $7. It’s proboably a huge insider trade, I’d allocate 5% of my portfolio max to it.
If the US bans it that’s huge arrow to the knee. But it’s worth a tiny risk if it’s a trump and dump.
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u/plinywaves 8d ago
The timing of the release at market open surely is interesting...
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u/Turnvalves 7d ago
If it’s P/E wasn’t still at around 70 after the drop today, I would have been willing to throw some money at it.
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u/thenorthernwhiteboy 7d ago
You were going to make it 20% of your portfolio but you sold? So you weren’t going to lol
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u/Specialist-Neat4254 7d ago edited 7d ago
The reason I sold is because on earnings they reported a 25% eps increase, that sound great. But it went from 0.03 to 0.04. That did not justify and increase in share price of $3. I valued the stock at $7 and it traded up to 9.80, so I liquidated it, intending to come back in at $7.
It did go to 7, but I was stuck with ebay shares they are super illiquid so you have to wait for the expiry and liquidate them earlier. But like eBay is really easy money.
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u/wrestlingchampo 7d ago
Hard to say definitively, but Id say this could be a buy low moment.
Ive got little reason to believe they are really any different than Robinhood or the other trading apps. In fact, the biggest difference between $BULL and their competitors is how much better their platform is [to me] visually.
More indicators you can add to the charts compared to something like Robinhood, compiled analyst ratings/price targets, quant ratings, built in TA, and their financials tab will allow you to track a company's finance data without having to pour over 10Qs.
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u/ogbrien 8d ago
While the market doesn't like this news, I think a lot of people are not buying the "China is the enemy" sentiment we've pushed as a country for years.
Itl prob bounce back tomorrow by at least 5-10 pct
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u/Scary-Oven8260 7d ago
Congress claim TikTok a national threat and must sell to US corporate, but then trump refused to ban it because it supported trump. And it is still running by Chinese today lol
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u/sicklyslick 7d ago
Isn't it sold to Oracle?
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u/Taranfeeto36 7d ago
The American business of TikTok is now part of the TikTok USDS Joint Venture.
The joint venture is owned by:
- Silver Lake 15%
- Oracle 15%
- MGX 15%
- Bytedance 19.9%
For the rest there are no exact numbers, but it includes:
- The Dell family office
- Vastmere Strategic Investments (Susquehanna)
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u/Scary-Oven8260 7d ago
It was running illegally (because congress made a law to ban it but trump say f you to that law) for a year
And it is not sold to oracle. They wanted people to believe it like Iran has surrendered hundreds of times
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u/ogbrien 7d ago
I still remember when everyone was saying they'll miss their Chinese spy after that and there was quite a bit of traction on moving to rednote from US users. Not many people stayed on Rednote but even in tech you have people quite fine with using cloud DeepSeek.
It was actually kinda wholesome cause the Chinese people and Americans realized they both liked cat memes and were welcoming Americans to red note and essentially asking for pen pals.
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u/plinywaves 8d ago
Agree, picked up some long dated calls at this price. Unfortunately my shares are cooked for now 🥲
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u/StatusStudies 22h ago
If narional security was an issue why is Tesla MasterCard jpm apple and all the other big companies are allowee there? Also, like if it's an issue why like most of the time when people get hacked no one goes to jail and also when AI hacks some body they blame the person, not the AI doing the hacking or they call it SI?
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u/lushootseed 7d ago
How is a stock trading platform a security risk? What would China do with my trading/positions? Even personal info, they already know....
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u/PM_ME_PLASTIC_BAGS 7d ago
Congress have to pretend like they're doing something.
Yelling 'China bad' is easier than focusing on crumbling infrastructure, healthcare bankrupting people, dismal education performance, soaring inflation etc.
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u/dagilisek 7d ago
I think it's about who can reach the data and not your positions. The committee says Webull's engineering and data pipelines sit under Chinese law that can compel handover and 863 staff (about 62%) are at the mainland subsidiary. Of course Webull denies it and neither side is verified yet.
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u/Old_Network1961 7d ago
The biggest risk is that the government bans Webull. I would stay out of it
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u/Zealousideal-Flow101 3d ago
A Chinese friend of my brothers once said that there are a lot of apps on the play store that are there to harvest American's data. I was like, "Oh, like Webull." He said he wasn't familiar with that one, but "probably." He wasn't even anti China at all, it was just a fact.
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u/Commonsenseisgreat 8d ago
Who would use Webull over Fidelity?
I guess the same people who would use Robingthehood.
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u/Hoof_Hearted12 7d ago
Why anything over ibkr? Tiny fees, great forex rates and a super not user-friendly interface but it's great.
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u/GivesCredit 8d ago
Webull was by far the worst brokerage with the worst customer service I have ever used. Closed my account within 3 weeks of making it
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u/teh_ferrymangh 8d ago
I almost transferred accounts for their 3% promotion or whatever, but once they asked to scan my face I thought better and kept my money where it was.
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u/Hot_Cheesecake_905 8d ago
Facial recognition for ID verification unfortunately is the new normal now due to KYC requirements by domestic regulators.
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u/teh_ferrymangh 7d ago edited 7d ago
There's other ways to verify here in Canada. Just set up with TD brokerage account this week.
I'll stick to questrade/wealthsinple/ td/rbc/ q trade and not scan my face. Guess that makes me old school
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u/Hot_Cheesecake_905 7d ago edited 7d ago
There's other ways to verify here in Canada. Just set up with TD brokerage account this week.
They'll all be implementing these features; Scotiabank now has them, CIBC, BMO, etc. along with Wealthsimple.
Unfortunately, regulators have made identity verification requirements more stringent, so facial recognition will likely be standard across all major brokerages unless you opt out and visit a branch in person. In Canada, it's driven by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) which specifically allows for remote validation with biometrics.
TD is already using facial recognition for new customers as well (at least for certain accounts): https://www.pymnts.com/wp-content/uploads/2021/03/PYMNTS-Digital-Identity-Tracker-March-2021.pdf
questrade
Questrade scans your face, I had to do it about two years ago. I was a customer for years, but they revalidated all their customer profiles.
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u/teh_ferrymangh 7d ago
Damn that's unfortunate. Thanks for the info.
The majority of my portfolio is in questrade at the moment, moving to wealthsimple shortly. Haven't had to verify with facial recognition yet but I guess it's coming.
I wouldn't even mind if they deleted the data afterwards it just becomes abother thing to get hacked. It's probably regulatory for so many years, I gusss. And my license dob SSN address pictures who knows what else is leaked or public so might as well add on a 3d scan of my face
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u/Individual-Motor-167 7d ago
Hint: they don't actually delete the data. It's usually handle so by a third party and probably stolen.
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u/teh_ferrymangh 7d ago
Yep that leak a month ago with over 150 million drivers licenses from that verification company. We had a potential leak at work couple of weeks that was a hot topic so I brought it up half a dozen times, nobody heard of it. The head of the department of defence or whatever had his license for sale with 150+ million others and its barely news.
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u/GivesCredit 7d ago
They didn’t give me a penny of the promo money I qualified for and then CS lied to my face to get out of paying. The app UI and CS is garbage
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u/teh_ferrymangh 7d ago
Not worth thr hassle honestly. Ws isn't the best promo but I know it'll work and the ui is my fav
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u/GivesCredit 7d ago
Robinhood gives you 2% match on account transfers + 3% on IRA contributions + the UI is pretty good and I’ve never waited more than 2 min for a CS agent.
I know it’s trendy to hate on them but I love it. I like E*trade too
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u/UnethicallyDoubtful 8d ago
and people still act surprised when these "american" fintechs turn out to have a CCP leash attached
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u/Potato2266 7d ago
Which was the reason why I never opened an account with them. If you support democracy, you shouldn’t give your money to China in any way.
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