Huobi decides to leave China before crackdown
Bitcoin exchange Huobi decided to leave China before Beijing once again tightened regulation of the cryptocurrency industry. The company also ruled out further operations in the country, Bloomberg reports.
Hours before China issued its sweeping ultimatum against cryptocurrency trading, the industry’s last remaining giant player had already decided to call it quits https://t.co/bfp3VkBs1T— Bloomberg (@business) October 5, 2021
According to the publication, at a meeting of shareholders on September 24, Huobi founders and backers "unanimously supported" the departure from the Chinese market.
Later the same day the National Development and Reform Commission of the People's Republic of China pointed out the negative impact of mining on the environment and its "insignificant" contribution to the economy. The People's Bank of China (PBOC) described as illegal the activities of platforms that provide exchange of digital assets among themselves or in fiat. Prior to that, Wen Xinxiang, director of the NBK's payments and settlement department, called cryptocurrencies and staplecoins a threat to the traditional financial system.
Breaking: The Chinese government released detailed documents on cracking down on cryptocurrency mining. https://t.co/yxGjzkUeLp— Wu Blockchain (@WuBlockchain) September 24, 2021
Huobi stopped registering new users in mainland China and announced it would delete existing accounts by December 31.
Exclusive: Huobi, the largest exchange in the Chinese region, suspends the registration of all new users in mainland China. pic.twitter.com/mkbMQPoXz3— Wu Blockchain (@WuBlockchain) September 25, 2021
"In the past, we had been communicating with regulators to see if there are still ways to legally operate in China. But this time, there’s no room for discussion", co-founder Du Jun said in an interview with Bloomberg. The original plan, which was backed by investors Sequoia China and ZhenFund, was to shut all Chinese user accounts, but "the surprise official statement" only accelerated the process, Du Jun noted.
"Our strategy is all about going global now," he added. This is evidenced by the active hiring of employees in Turkey and Brazil, the publication notes. The firm's co-founder added that Huobi Group currently generates nearly 70% of its revenue outside of China.