Why Did This Crypto Exchange Withdraw its Hong Kong License Application?

Following the Hong Kong regulator’s mandate for crypto exchange licenses, Huobi has revoked its license for trading under Huobi HK.

The Hong Kong Securities and Futures Commission (SFC) continually advises investors to conduct due diligence on crypto platforms through its website.

Huobi Withdraws Hong Kong Crypto Exchange License

The SFC’s website indicates that Huobi HK withdrew its application just three days after submission on February 23. It applied under its local entity HBHL Hong Kong Limited.

Recently, two other crypto exchanges, Amber and BitHarbour, also withdrew their licenses. However, Meex had its application returned on February 7 for undisclosed reasons.

List of applicants whose licence applications have been returned, refused or withdrawn. Source: SFC

BeInCrypto recently reported that as of February 29, all crypto exchanges in Hong Kong must either obtain or apply for a VATP license.

Read more: 10 Best Crypto Exchanges And Apps For Beginners In 2024

The commission emphasized the importance of trading through licensed exchanges, urging investors to regularly check the regulatory status of their platforms. The SFC stated:

“Investors should check whether a VATP is on the ‘List of licensed virtual asset trading platforms’ or the ‘List of virtual asset trading platform applicants.’”

Hong Kong SFC Ramps Up Compliance Efforts

However, the SFC is actively addressing various aspects of crypto exchanges to ensure comprehensive compliance.

On January 30, OSL, one of the approved exchanges, reported that the SFC has lowered the mandated insurance coverage on digital assets to 50%.

Read more: 7 Best Crypto Exchanges in the USA for Bitcoin (BTC) Trading

The SFC has expanded its scope to include over-the-counter (OTC) crypto products, aiming to subject them to the same regulations as other crypto exchanges or products.

The proposal is open for public consultation, driven by concerns over anti-money laundering measures. Currently, OTC trading lacks the stringent requirements imposed on regular crypto exchanges.