Binance-backed HKVAEX shuts down, gives users 30 days to withdraw amid Hong Kong regulatory tightening

Binance-linked HKVAEX exchange is closing down and has withdrawn its application for an operational license in Hong Kong, according to a notice on the Securities and Futures Commission (SFC) website.

The crypto trading platform, operating under the name BX Services Ltd, formally withdrew its license application on March 28, approximately three months after it applied with the financial regulator.

Then, early on March 29, the company announced the “Phased suspension and closure” of its services, offering users less than a month to withdraw assets by Apil 30. There will be “a complete closure of [HKVAEX] official website on 1 May 2024.”

Last year, reports emerged that Binance backed HKVAEX’s bid to secure a local crypto license in the region. The Hong Kong entity reportedly shared resources with the Richard Teng-led exchange and held joint events with the significant crypto firm.

At the time, industry experts warned that Binance’s guilty plea in the United States could impact HKVAEX’s chances of securing licensing in the Asian country.

It was unclear if Binance’s regulatory struggles informed the recent license withdrawal.

Meanwhile, reports have suggested that HKVAEX’s application withdrawal might be due to incomplete documentation or other reasons.

Notably, HKVAEX is not the only major applicant that has recently withdrawn its applications. Last month, HTX’s Hong Kong subsidiary briefly withdrew its application before resubmitting it after a few days. It now appears unlikely that HKVAEX plans to resubmit its application.

This development coincides with Hong Kong SFC’s ongoing efforts to regulate the emerging industry.

Recently, the SFC has augmented its scrutiny by flagging prominent crypto companies like Mexc and Bybit for operating without licenses within its jurisdiction, categorizing them as suspicious virtual asset trading platforms.

Moreover, February marked the end of the registration window for crypto firms seeking licensing to operate in Hong Kong. The regulator has consistently warned that unregistered entities in its jurisdiction must close their businesses by the end of May.

A HVAEX statement reads,

“We apologise for any inconvenience caused by our platform’s closure. We’re grateful for your support and trust in HKVAEX and urge users to take appropriate action by withdrawing their assets by 30 April 2024.”

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