Webull Explained

Webull
Type:Privately held company
Industry:Financial services
Founded:[1] [2]
Founders:Wang Anquan[3]
Hq Location City:St. Petersburg, Florida, U.S.
Key People:Anthony Denier (President)[4]
Products:Electronic trading platform
Services:Stockbroker
Owner:Wang Anquan[5]
General Atlantic
Coatue Management
[6] Lightspeed Venture Partners
J. Rothschild Capital Management
Gopher Asset Management
Parent:Hunan Fumi Information Technology

Webull Corporation is a electronic trading platform owned by Hunan Fumi Information Technology, a Chinese holding company.[7] The platform offers low-cost trading of stocks, exchange traded funds (ETFs), options, margins, fixed income, and futures, with no platform fees.[8] Founded in 2017, Webull is accessible via its mobile app and through desktop.

Webull's holding company has received backing from Xiaomi, Shunwei Capital, and other private equity investors in China.[9] The holding company is incorporated in the Cayman Islands and headquartered in St. Petersburg, Florida.[10] Webull is expected to become a public company in 2024 via a special-purpose acquisition company (SPAC).[11]

Webull has received criticism from U.S. lawmakers and states attorneys general over its ties to Chinese companies. In 2024, a coalition of state attorneys general launched a probe into Webull over user privacy issues and concerns about the company's links to Chinese Communist Party (CCP) interests.

History

Foundation and early history (2017-2021)

On May 24, 2017, Webull Financial LLC was established as a Delaware limited liability company[12] by Wang Anquan, a former employee of Alibaba Group.[13] In 2019, Webull's U.S. CEO Anthony Denier stated that Webull was “both a U.S. and Chinese company” in an interview.

In May 2020, the company received SEC approval to launch a robo-advisor on its platform.[14] By August 2020, the platform had over 11 million registered users, and in October 2020, it had 750,000 daily active users.[15] [16] In November 2020, Webull began supporting cryptocurrency transactions.[17]

On January 28, 2021, Webull halted buy orders for stocks affected by the GameStop short squeeze.[18] On that day, Webull recorded its highest-ever number of active daily users at 952,000.[19] That week, approximately 1.2 million people downloaded the Webull mobile app.[20]

Sports deals and IPO negotiations (2021-present)

In September 2021, the Brooklyn Nets and New York Liberty entered into a global multi-year agreement with Webull and the company became the official jersey patch partner for the Nets.[21] Terms of the agreement for the jersey patch weren't announced, but people familiar with the agreement told CNBC that it is a multi-year pact that pays the Nets roughly $30 million per year.[22]

In June 2021, Webull began talks of an initial public offering to raise up to $400 million.[23] [24] As of August 2024, Webull is set to go public on Nasdaq via a special-purpose acquisition company (SPAC) agreement worth US$7 billion.

Controversies

Webull has received controversy owing to its ties to Chinese companies, with Anthony Denier, Webull's U.S. CEO, describing Webull as "both a U.S. and Chinese company" in 2019.

2023 FINRA fine

In 2023, the Financial Industry Regulatory Authority (FINRA) fined Webull $3 million over the company's response to customer's complaints as well as its failure to conduct due diligence when allowing users to trade options.[25]

Lawmaker scrutiny

The Wall Street Journal reported that a number of U.S. lawmakers, including Senator Tommy Tuberville of Alabama, have expressed concerns about Webull in congressional hearings and letters to regulators. In 2022, Tuberville led a bipartisan coalition of U.S. senators in introducing legislation to prevent Webull and other Chinese-owned companies from owning crypto exchange platforms.[26]

2024 U.S. state attorneys general probe

In 2024, attorneys general from 14 U.S. states launched a probe into Webull centered on data privacy concerns and its potential ties to the Chinese Communist Party.[27] In June 2024, the state of Tennessee banned Webull on all government-issued devices.[28]

Userbase

The company has stated it has approximately 20 million users worldwide as of 2024. Anthony Denier, the company's CEO, claimed that Webull's userbase attracted more advanced and experienced investors than competing platforms, such as Robinhood.[29]

Notes and References

  1. News: GameStop, AMC Trades to Resume at Chinese Online Brokers . . January 29, 2021 . subscription . January 31, 2021 . April 17, 2022 . https://web.archive.org/web/20220417232802/https://www.bloomberg.com/news/articles/2021-01-29/gamestop-trades-restricted-at-tencent-backed-chinese-broker-futu . live .
  2. News: Michael . Wursthorn . Euirim . Choi . Does Robinhood Make It Too Easy to Trade? From Free Stocks to Confetti . . August 20, 2020 . subscription . January 12, 2021 . December 12, 2023 . https://web.archive.org/web/20231212085204/https://www.wsj.com/articles/confetti-free-stocks-does-robinhoods-design-make-trading-too-easy-11597915801 . live .
  3. News: Massa. Annie. Webull is winning over traders from US rival. Australian Financial Review. December 10, 2020. January 13, 2021. December 9, 2023. https://web.archive.org/web/20231209084740/https://www.afr.com/wealth/investing/china-s-robinhood-is-winning-over-traders-from-us-rival-20201210-p56m8b. live.
  4. Web site: ON THE MOVE: Firstrade Appoints Don Montanaro; Webull Promotes Anthony Denier . January 16, 2024 . April 11, 2024 . February 28, 2024 . https://web.archive.org/web/20240228132349/https://www.tradersmagazine.com/featured_articles/on-the-move-firstrade-appoints-don-montanaro-webull-promotes-anthony-denier/ . live .
  5. News: Massa . Annie . Robinhood Is Losing Thousands of Traders to a China-Owned Rival . . December 8, 2020 . subscription . January 2, 2021 . April 1, 2023 . https://web.archive.org/web/20230401133824/https://www.bloomberg.com/news/articles/2020-12-08/robinhood-is-losing-thousands-of-day-traders-to-china-owned-webull . live .
  6. Web site: Archived copy . April 15, 2024 . February 28, 2024 . https://web.archive.org/web/20240228145807/https://www.sec.gov/Archives/edgar/data/1866364/000121390024017777/ea0200860-425_webullcorp.htm . live .
  7. News: Zeldin . Lee . 13 July 2023 . Biden's financial regulators give China-backed brokers a hand, but who is surprised? . live . https://web.archive.org/web/20231004153641/https://www.washingtontimes.com/news/2023/jul/13/bidens-financial-regulators-give-china-backed-brok/ . October 4, 2023 . 23 September 2023 . .
  8. Web site: Malaysia . Fintech News . 2024-05-20 . Webull Has Officially Launched Its Global Trading App in Malaysia . 2024-12-04 . Fintech News Malaysia . en-US.
  9. Web site: McGregor . Grady . February 2, 2021 . The Robinhood revolt was good for Webull, China's little-known trading app . live . https://web.archive.org/web/20230601060233/https://fortune.com/2021/02/02/robinhood-stock-trader-revolt-webull-alternative-china-app/ . June 1, 2023 . 2021-08-06 . . en.
  10. Web site: UNITED STATESSECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 . live . https://web.archive.org/web/20240228145807/https://www.sec.gov/Archives/edgar/data/1866364/000121390024017777/ea0200860-425_webullcorp.htm . February 28, 2024 . 2024-05-02 . www.sec.gov.
  11. Web site: 2024-08-21 . Online brokerage Webull targets young Asian traders ahead of IPO . 2024-10-14 . South China Morning Post . en.
  12. Web site: Webull Financial LLC. Delaware Department of State: Division of Corporations. February 14, 2021. September 20, 2016. https://web.archive.org/web/20160920145319/https://icis.corp.delaware.gov/Ecorp/EntitySearch/NameSearch.aspx. live.
  13. Web site: January 12, 2021. Form ADV - CRD #: 304881. SEC Reports. August 6, 2021. November 10, 2022. https://web.archive.org/web/20221110002226/https://sec.report/AdviserInfo/Firms/304881/Form-ADV-304881.pdf. live.
  14. News: Renato . Capelj . Webull Leverages Crisis To Spur Innovation, Financial Wellness . . May 6, 2020 . subscription . January 13, 2021 . April 26, 2023 . https://web.archive.org/web/20230426165059/https://www.marketwatch.com/story/webull-leverages-crisis-to-spur-innovation-financial-wellness-2020-05-06 . live .
  15. News: Michael . Graw . August 20, 2020 . Commission-free brokerage Webull launches desktop platform . . January 2, 2021 . December 12, 2023 . https://web.archive.org/web/20231212213413/https://www.techradar.com/news/commission-free-brokerage-webull-launches-a-new-desktop-platform . live .
  16. News: Alexander . Osipovich . Individual-Investing Boom Fuels Trading in Low-Price Stocks . October 16, 2020 . . subscription . January 12, 2021 . December 9, 2023 . https://web.archive.org/web/20231209140626/https://www.wsj.com/articles/individual-investing-boom-fuels-trading-in-low-price-stocks-11602840602 . live .
  17. News: Paul . Vigna . Bitcoin Tops $20,000 for First Time . . December 16, 2020 . subscription . January 13, 2021 . January 15, 2021 . https://web.archive.org/web/20210115012610/https://www.wsj.com/articles/bitcoin-climbs-above-20-000-to-record-11608130696 . live .
  18. Web site: Crowley . James . January 28, 2021 . Webull follows Robinhood in blocking GameStop, AMC trades after being suggested as alternate trading platform . live . https://web.archive.org/web/20210128172109/https://www.newsweek.com/webull-blocks-gamestop-amc-transactions-stock-market-robinhood-1565172 . January 28, 2021 . January 28, 2021 . Newsweek.
  19. News: Perez . Sarah . January 28, 2021 . Robinhood and Reddit top the App Store, as trading apps surge following gamestop mania . live . https://web.archive.org/web/20210215193943/https://techcrunch.com/2021/01/28/robinhood-and-reddit-top-the-app-store-as-trading-apps-surge-following-gamestop-mania/ . February 15, 2021 . February 14, 2021 . TechCrunch.
  20. News: Vanian . Jonathan . February 2, 2021 . Robinhood, Webull, and Fidelity apps soar amid GameStop controversy . live . https://web.archive.org/web/20210202203709/https://fortune.com/2021/02/02/robinhood-webull-fidelity-apps-soar-gamestop-amc-reddit/ . February 2, 2021 . February 14, 2021 . Fortune.
  21. Web site: Brooklyn Nets and New York Liberty form Global Multi-year Partnership with Webull . live . https://web.archive.org/web/20210927201556/https://www.nba.com/nets/news/2021/09/27/brooklyn-nets-and-new-york-liberty-form-global-multi-year-partnership-webull . September 27, 2021 . 2021-10-11 . Brooklyn Nets . en.
  22. Web site: Young . Jabari . 2021-09-27 . Brooklyn Nets land $30 million per year jersey deal with brokerage platform Webull . live . https://web.archive.org/web/20211010033410/https://www.cnbc.com/2021/09/27/brooklyn-nets-land-30-million-per-year-jersey-deal-with-webull-.html . October 10, 2021 . 2021-10-11 . CNBC . en.
  23. Web site: June 8, 2021 . Online Broker Webull Considers $400 Million U.S. IPO . live . https://web.archive.org/web/20210713091220/https://www.bloomberg.com/news/articles/2021-06-09/online-broker-webull-is-said-to-consider-400-million-u-s-ipo . July 13, 2021 . 2021-07-04 . Bloomberg.
  24. Web site: Dayal . Nikhil . 2021-06-10 . Webull In Talks To File For IPO Later This Year: Report . live . https://web.archive.org/web/20210709182703/https://www.benzinga.com/fintech/21/06/21517405/webull-in-talks-to-file-for-ipo-later-this-year-report . July 9, 2021 . 2021-07-04 . Benzinga . English.
  25. Web site: Mccrank . John . 2023-03-09 . Wall Street watchdog fines Webull for options customer approval violations . 2024-08-14 . Reuters.
  26. Web site: 2023-06-16 . Tommy Tuberville announces bipartisan bill to block Chinese owned companies from owning crypto-currency exchanges . 2024-10-14 . Alabama Today . en-US.
  27. News: Osipovich . Alexander . April 17, 2024 . Trading App Webull Faces Multistate Probe Over China Ties . subscription . 2024-05-02 . . en-US . May 2, 2024 . https://web.archive.org/web/20240502160747/https://www.wsj.com/livecoverage/stock-market-today-earnings-04-17-2024/card/trading-app-webull-faces-multistate-probe-over-china-ties-Fz1MYjvQlyyseedqOmve . live .
  28. News: Osipovich . Alexander . June 13, 2024 . Webull's China Problem Grows With Tennessee State Ban . subscription . June 13, 2024 . . June 14, 2024 . https://web.archive.org/web/20240614005911/https://www.wsj.com/livecoverage/stock-market-today-dow-sp500-nasdaq-live-06-13-2024/card/webull-s-china-problem-grows-with-tennessee-state-ban-pe9taMNTqQZm8DebGHvs . live .
  29. Web site: Li . Yun . 2024-02-28 . Online trading platform Webull is set to go public via a $7.3 billion SPAC deal . 2024-10-14 . CNBC . en.

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