Will Weibo's User Privacy Dilemma Sink the Stock?

Chinese social network Weibo (NASDAQ: WB) issued a warning to its users on Sep. 8, giving them one week to verify their accounts with real names. That statement was made in response to a notice from the Cyberspace Administration, which recently issued new rules that required messaging service providers to verify the identities of their users and retain group chat logs for at least six months.

The government already asked Weibo to identify all its users by their real names in 2011, but Weibo's parent company SINA (NASDAQ: SINA) later admitted that it hadn't enforced the rules because it was time-consuming and alienated users. Regulators then ramped up real name identification efforts in 2015, but the new rules also weren't strictly enforced due to the difficulty of filtering fake identities.

Weibo's mobile app. Source: Google Play.

Source: Fool.com