Huobi to Reopen In The US With Strategic Partner, Months After Closing Due to Regulation Issues
- Huobi plots US comeback less than five months after they shut down their Huobi US (HBUS) citing regulatory crunches.
- They have devised a way of reopening services to US markets that may well include acquiring a minority stake in an undisclosed already licensed US brokerage firm.
Reports have emerged that crypto exchange Huobi is plotting a comeback to the US markets. This barely more than five months ago when they suddenly closed their San Francisco based branch (HBUS): launched in 2018, citing low liquidity and demand thus deeming HBUS an unprofitable venture. Since then, the US platform fortunes dwindled recording trading volumes of a meager $200,000 daily.
According to their VP of global business, Ciara Sun the exchange had devised a way of reentering US markets while ensuring they remained compliant at low costs. They are set to partner with an already regulated US firm. They would still be the Huobi Group but not a totally independent entity like HBUS explained Sun. They are reportedly in the process of acquiring a minority stake in a brokerage whose name Sun wasn’t keen to release.
The unique partnership would enable them to offer Over the Counter (OTC) Brokerage and asset management services tailored specifically for institutional investors with plans to loop in retail investors to the fold later on.
Cited regulatory crunches
Notably, their grand entrance in the US was back in 2018. Then they had acquired licensing from the Financial Crimes Enforcement Network (FinCEN) as a money service business (MSB). They recruited big shot asset manager Katelyn Mew as head of their new institutional sales and service group. They also sought the BitLicense from New York which put them in the big leagues.
However, they were faced with a mammoth setback as a crypto exchange as they had to get operating licenses in all the states they operated in. they managed 43 out of the 50 states in the US, though restricted to token-token trading rather than token-fiat trades.
Huobi’s aggressive expansion plan
The deal would place Huobi on Securities and Exchange Commission good books and allow them to offer an even broader spectrum of services. Originally from China, Huobi has conquered geographical barriers and set up shop in Hong Kong, South Korea, and Singapore.
They have also set up offices in Europe; London and Russia as well as South America (Argentina) who they support from their main Huobi global platform that boasts of daily trading volumes of reportedly up to $1.81 billion.