China’s Biggest Crypto Exchange Moves Regional Headquarters to Singapore
China’s biggest cryptocurrency exchange, Huobi Global has chosen Singapore as the base for the regional headquarters of its cryptocurrency exchange. This comes across as one of the major fallouts of the continuing clampdown of Bitcoin and other cryptocurrency activities in China. Until its exit from the country, Huobi was the biggest cryptocurrency exchange to operate in China.
China’s clampdown on cryptocurrencies is more and more being recognized for what it is. The follow-through in 2021 signifies a level of seriousness that was not there in the previous years. Before now, there have been a series of announcements and statements of bans released in China over cryptocurrency activities. When something similar came up in 2021, many thought it would turn out like the previous cases.
Many events, of which the exodus of Huobi crypto exchange stands out, prove this episode of clampdown to be serious.
In September, Huobi released a statement notifying the public that it would no longer accept new users from mainland China. This was part of the measures taken towards its gradual exit that will lead to a complete exodus from the region. This happened after the People’s Bank of China (PBoC) aimed at all virtual currency-related activities taking place in China. The bank declared such activities illegal, including overseas exchanges that were providing services to users from the mainland.
According to Huobi, the exit process will be in a gradual form until December 31st, 2021, when all accounts of users from mainland China will be retired.
This does not mean that the company is shutting down, rather, it will be moving its operational services to a more friendly jurisdiction. In line with this development is the establishment of a regional headquarters in Singapore. According to reports, the new regional headquarters will manage Huobi’s operations for Southeast Asia. Information on whether the office will cover more jurisdictions remains unclear as of the time of writing. However, the co-founder of Huobi, Du Jun was quoted as saying that the office will manage operations across the whole of Asia.
Huobi’s movement to Singapore is not a sudden one, as since May when the crackdown on cryptocurrencies activities in China started to pick up momentum, the exchange began to move most of its staff to its Singapore office. Du Jun himself has also moved to the new location, while the other co-founder, Leon Li remains in China only as a result of border restrictions by the Chinese government.
The new office in Singapore will not serve any Singaporean Huobi customers. It will operate under Huobi International Pte., of which Li is a majority shareholder. Other shareholders of the enterprise include Atlas Value and venture capital firm Zhen Fund. Singaporean customers will continue to be serviced by Huobi Singapore, a subsidiary of Huobi Tech., a Hong Kong company that is also founded by Li.
In a new business model, Huobi plans to set up more regional headquarters in different parts of the world. A base in France or the U.K. is planned to be established by the company in 2023. Where the other regional headquarters will be located has not been decided yet. It will be subject to business growth and expansion dynamics.
Huobi’s exodus to China is significant, considering the global prominence of the exchange, especially for the fact that it is of Chinese origin. Other crypto-related entities have also left, finding new bases in crypto-friendly jurisdictions, with North America developing into a new hub for crypto activities, especially mining.