Huobi Plans Expansion in Hong Kong After New Regulation
Huobi Global, a major cryptocurrency exchange, is seeking a license in Hong Kong to expand its services to retail customers.
The business also plans to open a new Huobi Hong Kong exchange that will focus on institutional and high-net-worth individuals.
According to Justin Sun, the founder of Tron, Huobi may increase its staff in Hong Kong from 50 to 200 this year.
This move comes after the Hong Kong Securities and Futures Commission (SFC) recently opened new licensing and regulatory proposals for public comment.
Exciting news! Huobi is stoked about Hong Kong's pro-crypto policies & we're working hard to secure our crypto license there. Our aim is to be one of the first fully compliant exchanges in HK & collaborate with our Asia-Pacific users to drive digital asset growth! #Huobi #Crypto pic.twitter.com/ktZw1WE2cs
— Huobi (@HuobiGlobal) February 20, 2023
The proposed new framework would require cryptocurrency exchanges to register with the SFC, allowing them to expand their services to Hong Kong. The new regime is set to go into effect in June. It has already led to financial service providers lining up to participate in the expanded system.
Huobi’s decision to expand in Hong Kong is motivated by the city’s friendlier stance on cryptocurrencies and the possibility of retail sales, according to Sun. This starkly contrasts China’s regulatory crackdown on cryptocurrencies and initial coin offerings (ICOs).
Huobi’s parent company, Huobi Group, was forced to move its headquarters from Beijing to Singapore in 2017 due to the Chinese government’s restrictions on cryptocurrency trading.
In January, Huobi announced that it was cutting 20% of its staff, characterizing it as part of a company restructuring after Sun’s takeover in October. The exchange later announced in February that it was closing down its Huobi Cloud Wallet in May due to “strategic and product adjustments.”
The business is also expanding its services in other regions. In January, it announced the launching of a Visa-backed crypto-to-fiat debit card that Huobi customers residing in the European Economic Area can use worldwide. The card is expected to be available in the second quarter of this year.
In addition, Huobi is considering moving its headquarters from Singapore to Hong Kong. The company’s decision to move would be significant, as Singapore has long been seen as a cryptocurrency-friendly jurisdiction.
Nonetheless, Hong Kong is becoming increasingly attractive to cryptocurrency businesses due to its regulatory approach and proximity to mainland China, which is home to many cryptocurrency traders and investors.
Huobi’s expansion in Hong Kong and the launch of its new exchange are part of the company’s efforts to diversify its services and reduce its reliance on China. With the increasing regulatory crackdown on cryptocurrencies in China, Huobi’s move to Hong Kong could help it tap into a new market and expand its global reach.