The Hong Kong branch of cryptocurrency exchange HTX, formerly Huobi Global, has again retracted its application for a virtual asset trading platform [VATP] license. This action, confirmed by the Securities and Futures Commission [SFC], has resulted in the immediate shutdown of Huobi HK’s operations to adhere to the city’s regulations.
HBGL Hong Kong Limited, the company behind Huobi HK, first submitted its application on Feb. 20, 2024. Just three days later, on Feb. 23, they withdrew the application. The company resubmitted it on Feb. 26, just before the crucial deadline of Feb. 29 for crypto exchanges to operate legally in Hong Kong.
Despite these efforts, the SFC removed HGBL from its list of cryptocurrency license applicants. This further comes following the second withdrawal. The regulatory body has stipulated that platforms without a submitted license application must close by May 31, 2024, which Huobi HK must now comply with.
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Regulatory Landscape
Hong Kong has been enforcing stricter regulations on the cryptocurrency market. It has mandated that all exchanges obtain a VATP license to continue operations. The SFC’s stringent requirements aim to further enhance investor protection and ensure market integrity in the dynamic digital asset sector. However, the SFC has not disclosed the reasons for Huobi HK’s repeated withdrawals.
Currently, 20 other applicants are under review for the VATP license. This includes major players like OKX, Crypto.com, Bybit, and Bullish. These exchanges handle a substantial portion of global crypto trading, highlighting the importance of obtaining regulatory approval in Hong Kong’s competitive market.
Furthermore, the withdrawal of Huobi HK’s license application raises several questions about its strategic intentions and its capability to navigate Hong Kong’s regulatory environment.
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