HTX, formerly Huobi, withdraws Hong Kong crypto licence application three days after submission

Cryptocurrency exchange HTX, formerly Huobi Global, has withdrawn its application for a licence to operate in Hong Kong, in a dramatic retreat from its highly publicised plans to win customers in the city after exiting the mainland market.

The Hong Kong operation of HTX, HBGL Hong Kong Limited, withdrew its application for a licence for the virtual asset trading platform Huobi HK on February 23, three days after it submitted an application, according to the Securities and Futures Commission (SFC), which publishes a list of crypto exchange licence applicants on its website.

HTX did not publicly disclose its reason for withdrawal. It did not immediately respond to a request for comment.

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Three cryptocurrency exchange operators have withdrawn their applications so far, while one has had its application returned, according to the SFC.

Justin Sun, adviser for Huobi. Photo: Bloomberg alt=Justin Sun, adviser for Huobi. Photo: Bloomberg>

The Beijing-founded exchange – the fifth-largest in the world by 24-hour trading volume, according to data from market tracker CoinGecko – had been one of the biggest companies to submit a licence application in Hong Kong.

HTX first announced its plans to pursue a licence in Hong Kong in February last year through a statement made by its adviser Justin Sun on Twitter, now X. The outspoken crypto entrepreneur said the company would launch a new exchange called Houbi Hong Kong that would be compliant with the city’s new regulations.

The withdrawal came just days before a deadline for cryptocurrency exchanges hoping to operate legally in Hong Kong to put in a licence application.

Under the city’s new regulatory regime for virtual assets that took effect last year, companies selling or marketing cryptocurrencies to Hong Kong residents must apply for a licence by February 29 or cease business in the city by June 1 this year.

While only a few international cryptocurrency companies have submitted applications, the Hong Kong market has been seen as a particularly attractive option for firms with strong ties to mainland China, most of which moved their headquarters overseas during Beijing’s crackdown on the industry.

Those companies include some of the industry’s biggest names.

OKX, founded in Beijing in 2017 and now headquartered in the Seychelles, submitted its licence application in November. HKVAEX – an exchange with ties to China-founded Binance, the world’s largest crypto exchange – applied last month.

Binance does not currently list a headquarters, but its founder Zhao Changpeng was spending much of his time in Dubai before his arrest in the US last year for violating anti-money-laundering laws. The company’s current CEO Richard Teng lists his location as Dubai on his X account., founded in Hong Kong and based in Singapore, also applied for a licence this month. A total of 18 companies have submitted their applications as of Monday, according to the SFC.

Additional reporting by Matt Haldane

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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