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HTX Halts Hong Kong License Bid Amid Tightening Crypto Regulations

HTX formally retracts its bid for a Hong Kong crypto exchange license.

Tue, 27 Feb 2024, 11:41 am UTC

Cryptocurrency exchange HTX, previously known as Huobi Global, has withdrawn its application for a license to operate in Hong Kong, marking a significant retreat from its previously publicized endeavors to attract customers in the city following its departure from the mainland market.

HBGL Hong Kong Limited Pulls Licence Application

The Hong Kong arm of HTX, HBGL Hong Kong Limited, withdrew its application for a license for the virtual asset trading platform Huobi HK on February 23. This move came just three days after the application submission, as confirmed by the Securities and Futures Commission (SFC), which publishes a roster of crypto exchange license applicants on its website.

According to Coin Desk, HTX has not publicly disclosed the rationale behind its withdrawal and has yet to respond to requests for comment. Per the SFC, three cryptocurrency exchange operators have withdrawn their applications, while one has been returned.

HTX, headquartered in Beijing and ranked as the fifth-largest exchange globally by 24-hour trading volume according to CoinGecko, was among the major entities to seek a license in Hong Kong.

Background and Regulatory Landscape

HTX initially announced its intention to pursue a license in Hong Kong in February of the previous year through a statement by its advisor, Justin Sun, on Twitter. Sun, a vocal figure in the crypto space, outlined plans to launch a compliant exchange named Huobi Hong Kong, aligning with the city's updated regulations.

The withdrawal coincided with the looming deadline for cryptocurrency exchanges aspiring to operate lawfully in Hong Kong, requiring them to file for a license by February 29. Under the city's revamped regulatory framework for virtual assets implemented last year, companies engaged in selling or marketing cryptocurrencies to Hong Kong residents must either secure a license by February 29 or cease operations in the city by June 1 of the current year.

According to the South China Morning Post, while Binance's headquarters are not explicitly stated, its founder Zhao Changpeng spent considerable time in Dubai before his arrest in the US last year on charges of violating anti-money laundering laws. The company's current CEO, Richard Teng, identifies his location as Dubai on his X account., established in Hong Kong and headquartered in Singapore, also initiated a license application this month. According to the SFC, 18 companies submitted their applications on Monday.

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