Huobi Cloud Works to Stimulate Revenue Growth in Emerging Markets, 80 More Exchange Partners in Line
In the countries that have decided to allow cryptocurrency, there’s substantial competition to be the top home of these exchanges. A recent report from CoinDesk showed that Huobi Group, based out of Singapore, has decided to launch their own strategy for growth by partnering with local entities and splitting the revenue.
David Chen, the senior business director of Huobi Group, told the publication that the 150 platforms under the Huobi Cloud platform will be joined by the HIZA exchange in May.
Chen added that there are about 80 partnerships being planned, though the Huobi Cloud platform plans to create more business “when the market is more mature.” This method of expansion in the market is not solely done by Huobi. Binance, Bittrex, and similar exchanges are working to create subsidiaries that remain independent of each other in areas with emerging markets, including Uganda.
With this method of establishing partnerships, Huobi isn’t subjected to the same regulatory risks that they would normally face in these types of markets. Chen explained that, in the case of the South Africa’s HIZA exchange, the platform owns their customer data, which means that the responsibility of maintaining it falls on HIZA’s shoulders, rather than Huobi’s.
Furthermore, since the Cloud partnerships already established have gone live, Huobi Group has managed to bring in $1.5 million in net profit since October. By 2020, the group hopes to have $55 million in daily volume alone amongst their partnerships.
In Nigeria, the SaBi exchange, which was founded by Lucky Uwakwe, has many issues regarding regulatory atmosphere waiting ahead, if the volumes go up. Instead, the exchange is taking a multi-pronged approach that includes both over-the-counter services and peer-to-peer services.
The other operations allow the platform to have the space they need if the government puts a halt to their operations involving banks, while creating opportunities for their users.
At this point, there has not been so much as a direct outlawing of cryptocurrencies in these various jurisdictions, as there has been a lack of regulatory standards implemented. Faith Obafemi, a Nigerian lawyer, stated that “Bitcoin trading was not banned,” even though there’s a ban implemented that keeps banks and other financial institutions from investing with cryptocurrency.
The South African government has had a much more welcoming approach, as they look to the public for comments as they update regulations. Talha Idris, the founder of HIZA, stated that Huobi will be providing them with the assistance that they need in “all the technical aspects, especially security.”
Huobi Group stands to greatly profit from this move, considering that 11% of South Africans already have some stake in cryptocurrency. Uwakwe points out that there’s already local demand and “drive.” He added:
“Even when there are many bans and restrictions, people find a way to get these things.”