Alleged Binance affiliate ceases operations in Hong Kong

The withdrawal was confirmed by the SFC’s web site, and it comes almost three months after the preliminary utility was filed on January 4, simply forward of the SFC’s February 29 deadline for all crypto exchanges working within the area to use for licenses.

On account of withdrawing its utility, HKVAEX is now required to stop its operations in Hong Kong by Might 31. This improvement is a part of a broader development noticed this 12 months, with three different digital asset buying and selling platforms, together with the globally acknowledged Huobi trade, additionally retracting their license purposes for undisclosed causes.

Hypothesis throughout the crypto neighborhood, as voiced by Crypto Twitter influencer Wu Blockchain, means that these withdrawals might stem from numerous regulatory challenges, similar to requests to alter audit firms or present extra data.

The confusion surrounding HKVAEX and one other Hong Kong-based crypto trade, VAEX, was highlighted, with an HKVAEX consultant clarifying that VAEXC (one other applicant) had no affiliation with HKVAEX. This clarification got here amidst the background of Binance’s alleged connections to CommEx, a Russian crypto trade that lately introduced its shutdown and the cessation of deposits as of March 25.

Binance has distanced itself from HKVAEX and reiterated that HKVAEX shouldn’t be a part of Binance group. The worldwide crypto trade had beforehand signaled its intent to exit the Russian market following the resignation of key native executives and amidst escalating regulatory scrutiny.

Opposite to the stricter crypto laws on the Chinese language mainland, Hong Kong has been extra welcoming to crypto corporations. In June 2023, town initiated its crypto licensing regime for digital asset buying and selling platforms, permitting licensed exchanges to supply retail buying and selling companies.

The Securities and Futures Commission (SFC) introduced that every one crypto buying and selling platforms working with out having utilized for a license should conclude their operations within the area by Might 31, 2024.

The SFC has issued a directive to buyers engaged with digital asset buying and selling platforms to arrange for migrating their property to licensed entities or those who have submitted their purposes for a license. As of now, OSL Digital Securities and HashKey Exchange are the one two operators formally licensed by the SFC, having obtained their approvals on December 15, 2020, and November 9, 2022, respectively.

In whole, the regulator disclosed that 22 crypto buying and selling platforms had utilized for operational licenses beneath the brand new regulatory framework, together with 4 exchanges initially beneath the SFC’s elective regime for crypto buying and selling platforms. Nonetheless, 4 exchanges — Huobi HK, Meex, BitHarbour, and Ammbr — both withdrew their applications or had them returned by the SFC.