The crypto exchange Huobi has disclosed (1) its intention to relocate its Asia headquarters from Singapore to Hong Kong. This decision was made after the Securities and Futures Trading Commission (SFC) of Hong Kong suggested a new licensing scheme allowing cryptocurrency exchanges to service individual investors with large-cap currencies.
The recent collapse of FTX in November 2022 made an already difficult situation in the cryptocurrency market even more difficult, which led numerous cryptocurrency companies to close down their platforms.
As 2022 has been marked with back-to-back crypto debacles(TerraUSD setback in May of last year), it has alerted worldwide regulators, signaling that tougher crypto legislation should be implemented to prevent a repeat of the situation.
Meanwhile, policymakers in Hong Kong have taken a step toward making the country a hub for cryptocurrency by implementing policies that are cryptocurrency friendly. Because of this, cryptocurrency companies are vying for permission from the SFC to make the most of the favorable regulatory move that the regime is making.
In a statement, Justin Sun, who is both the originator of the Tron (TRX) cryptocurrency and an advisor at the Huobi exchange, said the following:
Because Hong Kong's regulatory system has undergone a significant positive change over the past three years, I am quite optimistic about the future of crypto compliance in Asia, particularly in Hong Kong and, hopefully, China.
A New Exchange on the Cards on Hong Kong from Huobi
In addition, Huobi intends to launch a brand-new cryptocurrency trading platform in the city known as Houbi Hong Kong. The expansion of the trading services that the platform provides to high-net-worth individuals and institutional investors will be the primary focus of the platform.
After Huobi submitted their application for the license the previous year, Justin Sun is optimistic that they will be approved in the Chinese special administrative region. However, it could not satisfy the more stringent standards that were in place at the time, and just two companies successfully obtained licenses.
Throughout a conversation with Nikkei Asia, Sun underlined the possibility that Huobi could increase the number of employees working at its Hong Kong-based subsidiary from fifty to two hundred. He pointed to recently suggested crypto-friendly policies as the only justification for this action.
Significantly, in January, Huobi made public their intention to adapt the platform's infrastructure per the present market state by announcing that they would be cutting their employees by twenty percent.
After taking over leadership of the platform in October, Justin Sun primarily focused on reducing the number of employees working for the company.
Julia Leung, CEO of SFC, brought attention to the decline of major firms like FTX while referring to the "current upheaval" in the industry. She emphasized that the crypto ecosystem required more transparency and that the protection of investors should be the priority.
Considering the recent trouble and the breakdown of some leading cryptocurrency trading platforms worldwide, there is a strong agreement between regulatory agencies worldwide for regulatory oversight in the virtual asset space. This regulation ensures that investors are properly protected and that key risks are appropriately handled.