Crypto Exchange Huobi to Re-enter US Market with New Focus
According to one of the co-founders of the Huobi crypto exchange, it is planning on re-entering the US market, two years after it shut down its operations in order to comply with the regulations. However, the Chinese firm may not actually launch an exchange after the missteps it made the last time. Instead, it may focus on offering asset management services. Du Jun stated that they had tried to enter the US market back in 2018, but had withdrawn themselves quickly because they didn’t have a strong commitment to the market back then and they lacked a strong management team as well.
He added that he thinks asset management would be a significantly bigger business and it is also associated with the traditional financial market. Jun went on to say that he didn’t believe introducing a crypto exchange is necessary in order to enter the US market. Nevertheless, Du did not give any confirmation about which business Huobi would introduce first if it does re-enter the US market. Doing so would put it in direct competition with exchanges like Coinbase. According to statistics from CoinGecko, Huobi is in the list of the top 10 crypto exchanges in terms of trading volume.
Huobi had introduced its crypto business in the United States back in 2018. The company had announced the following year that it would freeze US user accounts and had said that it would return in a more impactful and integrated fashion. The Huobi Group is listed in Hong Kong and it owns an asset management business and an exchange business, which is named Huobi Tech. The push into the US is part of the company’s bigger international expansion plan after a number of years of dealing with tough regulations in China, where it had been founded.
In the previous year, Beijing had begun a crackdown against crypto mining in China and had eliminated loop holes that Chinese citizens could use for trading. By the end of last year, Huobi had shut down the accounts of existing users from mainland China and had shifted its Asia headquarters to Singapore. Du disclosed that the crypto exchange has suffered a loss of 30% in revenue by shutting down its users in China. But, he added that this had given the company the impetus for expanding internationally. Along with its push in the US, they are also considering setting up operations in Europe.
Du said that as far as their staff and resources are concerned, they will use their entire strength in the international market because they don’t have any other choice for pushing their global strategy. He added that previously they had explored a new market and if it didn’t work out, they would withdraw, but now they didn’t have any other option than going global. Du was also full of praise of the regulation of crypto in China because it addressed issues of money laundering and gambling. He said that this regulation can offer protection to small investors. But, he said that other countries should not take the same route because they have more mature investors.
