In a surprising turn of events, Huobi HK, a subsidiary of HTX, has decided to withdraw its application for a cryptocurrency trading license from Hong Kong’s Securities and Futures Commission (SFC) for the second time. This decision has raised questions about the future of the company in the region and has highlighted the challenges faced by crypto exchanges in obtaining regulatory approval.
Hong Kong had set a regulatory deadline for crypto exchanges to obtain a license or cease operations by the end of May if they did not apply by February 29. The city has been actively working towards establishing itself as a crypto hub since June 2022, with only two platforms, HashKey and OSL, having secured licenses so far. The SFC has issued warnings against websites falsely claiming to be regulated exchanges and is currently reviewing 20 applications from major global crypto exchanges.
Huobi HK’s decision to withdraw its license application for the second time has raised concerns about the company’s future in Hong Kong. The lack of clarity surrounding the reasons for the withdrawal has led to doubts about the exchange’s ability to operate successfully in the region. This move by Huobi HK follows a similar decision by crypto platform HKVAEX, which ceased operations after withdrawing its license bid in March.
The withdrawal of Huobi HK’s license application presents a significant obstacle for Huobi Global, a major crypto exchange that ranks among the top five globally by 24-hour trading volume. This setback comes at a time when HTX advisor and crypto influencer Justin Sun had announced plans to launch a new Hong Kong-based exchange, Huobi Hong Kong, to comply with the city’s updated crypto regulations.
The withdrawal of Huobi HK’s license application highlights the challenges faced by crypto exchanges in navigating the regulatory landscape in Hong Kong. The lack of clarity surrounding the reasons for the withdrawal raises doubts about the company’s future in the region. As the SFC continues to review applications from major global crypto exchanges, the case of Huobi HK serves as a cautionary tale for firms operating in the crypto industry.