Shares of two big Chinese online brokerages fell sharply today after more bad regulatory news for the industry. Shares of Futu Holdings Ltd (NASDAQ: FUTU) traded nearly 16% down as of 1:55 p.m. EDT, while shares of Up Fintech Holding Ltd (NASDAQ: TIGR) were down nearly 18%.
Earlier today, an official at the People's Bank of China (PBOC), China's central bank, said online brokerages would not be in compliance with soon-to-be passed laws if they do not have an official brokerage license in China.
"Cross-border online brokerages are driving in China without a driver's license. They're conducting illegal financial activities," Sun Tianqi, China's head of the Financial Stability Department of the PBOC, said Wednesday, according to a transcript of his speech.
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Why Shares of Futu Holdings and Up Fintech Are Falling Today