Shenzhen Stock Exchange Questions Chinese Tech Firm’s Blockchain Move

Blockchain, News | July 16, 2018 By:

Chinese video streaming provider Leshi Internet is being questioned by the Shenzhen Stock Exchange regarding its smart TV subsidiary’s new blockchain business.

Last week, Lerong Zhixin, a smart TV maker owned by Shenzhen-listed Leishi, announced its partnership with blockchain firm One Chain Technology to launch a video streaming console that can be used to mine cryptocurrency. While allowing users to watch digital content at no cost, the new video streaming console, called “One-chain Box,” also rewards users with tokens by allowing their idle broadband to be shared with other users connected to the blockchain.

Following the announcement, the Shenzhen Stock Exchange demanded Leshi to provide detailed information regarding the current status of its blockchain partner, including related personnel, capital, technology patents, as well as One Chain’s core competitiveness and the foundation for its business. The stock exchange also challenged the firm to prove that its blockchain business operates within the lines of policy and regulations, both in China and overseas.

According to local reports, the Shenzhen Stock Exchange wants to ascertain if Leshi has the technology to deliver the promised product or it is just capitalizing on the blockchain hype to boost its stock price.

Founded in 2004, Leshi Internet has seen revenue and profit dwindle since mid-2017 amid a funding crisis involving parent conglomerate LeEco and its founder Jia Yueting. In May 2017, Leshi warned that its cash flow was “extremely tight” and could lose control of its smart TV subsidiary.