Chinese cloud-based solutions service, Seven Stars Cloud Group, Inc. (SSC), announced this week its 27 percent purchase stake of US crypto blockchain exchange Delaware Board of Trade Holdings Inc. (DBOT). SSC is owned and run by entertainment mogul Bruno Wu, who many analysts believe is trying to get in on the near-half a trillion cryptocurrency market.
Bruno Wu Buys Delaware Crypto Exchange
China’s SSC sent out a press release claiming “today a 27% purchase of The Delaware Board of Trade Holdings Inc. (“DBOT”), the first and only blockchain based Alternative Trading System fully licensed by the SEC, for 1,627,869 shares of SSC common stock. The transaction will make SSC the largest shareholder of DBOT”.
Referring to Mr. Wu as “One of China’s biggest business and entertainment moguls,” Jon Najarian also described DBOT as “a ‘dark pool’ operator” and how SSC had “plans to expand into the trading of ‘bitcoin-like’ securities,” he tweeted. The Delaware company is the only trading system of its kind licensed by the SEC, if the SSC press release is to be believed.
The announcement sent the Chinese company’s stock soaring on Nasdaq, up over 25 percent.
According to Seven Stars Cloud website, the company is “aiming to become a global leader in providing next-generation Artificial-Intelligence (AI) & Fintech Powered, Supply Chain + Digital Finance Solutions.” By purchasing a controlling interest in DBOT, SSC hopes its “regulatory approved platform will be the cornerstone for a ‘plug & play’ and blockchain based, Initial Exchange Offering (IEO) Network.”
John Wallace, CEO of DBOT, was quoted as saying, “We are thrilled to further partner and form a deeper business relationship with SSC as DBOT and its various business lines become key engines that power SSC’s Global Trading Platform Network for Initial Exchange Offerings.”
Mr. Wu’s Big Plans
Early this year, China’s Chongqing Casin Enterprise Group’s efforts were halted by the Securities and Exchange Commission (SEC) just as they tried to snap up the Chicago Stock Exchange. Legislators complained about the lack of transparency in the Chinese company’s corporate structure.
So far, the SEC hasn’t commented on Mr. Wu’s acquisition. Nevertheless, his company has big plans for the merger. It will “leverage DBOT’s established and regulatory approved ATS for powering SSC’s blockchain based Nextgen X, which focuses on the trading of financial products including ETFs backed by digital assets, that can be tokenized and settled (including digital currency options) via Initial Exchange Offerings (“IEO”),” the company stated. It hopes to establish a “plug and play” solution spread over 30 different exchanges in Japan, UAE, Singapore, Africa, Korea, China, Germany, and the United States.
The New York Post reports Mr. Wu has also purchased “a majority share of a Youtube-like company called YOU On Demand, which was owned by World Wrestling Entertainment scion and professional wrestler Shane McMahon — son of WWE founder Vince McMahon and his wife, Linda McMahon, the head of the Small Business Administration,” the paper explained.
For its part, SSC, based on the cryptocurrency-related rumors in the press, issued yet another release. In it, Mr. Wu himself explains, “Seven Stars Cloud is in no way a Bitcoin-related company and it must be highlighted that the opportunities and possibilities of Blockchain extend far beyond the world of cryptocurrencies,” he stressed. “Although initially created for Bitcoin, Blockchain provides a more secure and transparent way of managing all kinds of data and therefore, the numerous applications and uses of this technology are infinite.”
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Por C. Edward Kelso