Over 20 Listed Firms Involved in Blockchain Speculation were Regulated by China’s Stock Exchanges
March 19, ENJOYOR Company Limited, a Shenzhen listed intelligent system engineering company, announced that it received a warning letter from Shenzhen Stock Exchange and was required to explain whether it have motives for a sharp gains in stock prices by using the so-called blockchain concept speculation.
On March 16, Enjoyor announced on its official WeChat account that its affiliate internet finance company Numbull had partnered with a judicial appraisal centre in Zhejiang and issues the world’s first blockchain based electrical data forensic certificate.
The firm’s shares climbed to hit the limit-up price of 12.19 yuan at 10:19 am, soon after the announcement on that day. After a sharp gains in share price, the original post of the announcement has been deleted by Enjoyor.
All of these things caught the attention of the Shenzhen Stock Exchange. On Match 19, the exchange asked Enjoyor to publish relevant post on WeChat to clarify whether they are involved in false and misleading advertising and used the blockchain news to speculate. Enjoyor is also required to explained the reason of deleting the original announcement.
The Shenzhen Stock Exchange asked Enjoyor to specify when and how it invested in Numbull which includes the actual investment amount and shares it holds, as well as the main business, the financial data, relevant application scenario and business model of Numbull. Detailed process of the blockchain based electrical data forensic certificate was also required.
Behind the blockchain mania, it’s certainly not hard to imagine that, Enjoyor is not the only one company that using blockchain concept as a hype to gain profit. There are more than 20 listed companies have been warned, monitored and suspended from trading by Shenzhen and Shanghai Exchanges about their suspicious speculation on blockchain in 2018, according to the Beijing News.
The China’s two major bourses have issued warning notices to listed companies that made use of blockchain concept to mislead investors. On January 17, Shenzhen Stock Exchange has published a statement on its official Wechat account, claiming that it would take supervision measures on 17 blockchain-related companies.
“We would implement disciplinary punishment on companies that using blockchain concept to boost their own share price and mislead investors, severe violations will be reported to the China Securities Regulatory Commission (CSRC),” stated by the Shenzhen Stock Exchange.
Meanwhile, the Shanghai Stock Exchange also publish an announcement on January 18 and pointed out that 10 stocks surged in the market because of speculating on blockchain. The exchange required the firms to explain their blockchain business. Shanghai Stock Exchange also warned investors the blockchain technology is still in the early development stage, and the so-called blockchain concept stocks are not mature enough to make stable high profits.