Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
The crackdown on DIDI has been dual-faced with the company noting that the United States Securities and Exchange Commission (SEC) is also investigating it in relation to its IPO last year.
Chinese ride-hailing giant, DiDi Global Inc (NYSE: DIDI) woke up to become one of the best-performing stocks in the US today atop a 49.73% surge in the Pre-Market. Didi’s growth was trailed by very promising news that was broken by the Wall Street Journal (WSJ) which outlined that Chinese regulators are ending their probe into Didi.
The company became the subject of a cybersecurity probe from the Cyberspace Administration of China (CAC) shortly after it went public last year. The CAC accused Didi of illegally collecting users’ data and as a result, ordered the ride-hailing app to be delisted from app stores operational in China.
The probe brought a lot of challenges to the Beijing headquartered company and has caused the firm as much as an 85% plunge from its Initial Public Offering (IPO) price of $14. However, with the news, DIDI is now trading at $2.77 and is on track to regain its pace toward recovery.
Per the WSJ report citing anonymous sources, the regulators are billed to announce the end to the probes as early as next week. The end of the probe is a testament to the focus of China which has continued to experience economic fallout from the lockdown of Shanghai owing to the growing cases of coronavirus.
DIDI and the Broad-Faced Probe
The crackdown on DIDI has been dual-faced with the company noting that the United States Securities and Exchange Commission (SEC) is also investigating it in relation to its IPO last year. While there has been no significant enforcement action against Didi in the US yet, onboarding new users have been particularly arduous for the firm in China.
Should the probe be lifted as reported by WSJ, Didi will not only have its app back online in the most populous country in the world, but it would break the fallow ground of having no new sign-ups.
Besides Didi, the Wall Street Journal also listed Full Truck Alliance Co Ltd (NYSE: YMM) and Kanzhum Ltd (NASDAQ: BZ) as two of the firms for whom Chinese regulators will be dropping probes. The report has it that letting go of the probe does not mean the trio will just be let off the hook like that, the report claimed they all will be paying fines, but with Didi’s coming off much more than that of the other two.
The end of the probe into Didi may signify a new turn for Chinese regulators and a very massive succor for all of the homegrown firms. With a new light at the end of the tunnel for Didi, the company, in the light of its woes in the US has shared plans to delist its shares from the New York Stock Exchange and relist in Hong Kong instead.