Huobi Global (HGBL) Hong Kong Limited, a subsidiary of HTX, withdrew its application for a cryptocurrency trading license from Hong Kong’s Securities and Futures Commission (SFC) for the second time on May 14.

HTX’s Huobi HK Withdraws Hong Kong License Bid Again

Huobi HK is no longer on the SFC’s list of virtual asset trading platform applicants, indicating it has withdrawn its application again. This decision came just two months after Huobi HK had re-submitted its application on February 26, following an initial withdrawal three days prior.

HBGL, which operates Huobi HK, has withdrawn the licence application for unspecified reasons, requiring it to close the crypto exchange under the city’s virtual asset regulations. https://t.co/bynlfQIFot pic.twitter.com/8kPmUMXchu

— JPNWMN (@JPNWMN) May 15, 2024

Hong Kong had released a regulatory deadline that required crypto exchanges to obtain a license or cease operations in the region by the end of May if they failed to apply by February 29.

Hong Kong has been actively fostering its reputation as a crypto hub since June 2022 by permitting licensed exchanges to offer retail trading services. To date, only two platforms, HashKey and OSL, have secured licenses from Hong Kong regulators. The SFC has also issued warnings against websites falsely claiming to be regulated exchanges.

The SFC’s website indicates that numerous major global crypto exchanges, including OKX, Bybit, Bullish, and Crypto.com, are still undergoing the licensing process. The SFC is currently reviewing 20 such applications.

Despite Hong Kong’s apparent attractiveness, some crypto firms have abandoned the market. Huobi HK’s recent withdrawal marks the second time the company has pulled its application.

The SFC has not offered an explanation for these repeated withdrawals. This lack of clarity further fuels doubts about the exchange’s ability to operate successfully in Hong Kong.

Huobi HK’s actions mirror a similar move by crypto platform HKVAEX, which ceased operations on May 1 after withdrawing its license bid in March. HKVAEX was reportedly linked to Binance.

Setback for Huobi’s Global Expansion

The withdrawal of Huobi HK’s HTX Hong Kong License application presents a significant obstacle for Huobi Global (HTX), a major crypto exchange that ranks among the top five globally by 24-hour trading volume, according to CoinGecko data.

In early 2023, HTX advisor and crypto influencer Justin Sun announced the company’s plan to launch a new Hong Kong-based exchange, Huobi Hong Kong, to meet the city’s updated crypto regulations. In February 2024, an HTX representative clarified that Huobi HK operates independently from its parent company.

Huobi HK’s late February resubmission was reportedly an attempt to avoid shutting down operations on June 1, as stipulated by the new virtual asset regulatory regime implemented in 2022.

Although only a few international crypto companies met the application deadline, the Hong Kong market was seen as a desirable location for firms with Chinese roots that relocated abroad following Beijing’s industry crackdown.

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