The Binance-linked HKVAEX exchange has made the decision to close down and has officially withdrawn its application for an operational license in Hong Kong, as stated on the Securities and Futures Commission (SFC) website. The exchange, which operates under the name BX Services Ltd, formally pulled back its license application on March 28. This move comes approximately three months after initially applying with the financial regulator. Subsequently, on March 29, the company announced the “Phased suspension and closure” of its services, providing users with less than a month to withdraw their assets by April 30. Furthermore, the official website of HKVAEX will be completely closed by May 1, 2024.
Last year, reports surfaced regarding Binance’s support for HKVAEX’s attempt to secure a local crypto license in Hong Kong. The Hong Kong entity was said to have shared resources with the Richard Teng-led exchange and even held joint events with the prominent crypto firm. However, industry experts cautioned that Binance’s legal troubles in the United States might negatively impact HKVAEX’s prospects of obtaining licensing in the Asian country. It remains uncertain whether Binance’s regulatory challenges played a role in the recent decision to withdraw the license application.
Speculation suggests that HKVAEX’s withdrawal of the license application could be linked to incomplete documentation or other undisclosed reasons. Interestingly, HKVAEX is not the sole prominent applicant to have recently retracted its application. In the previous month, HTX’s Hong Kong subsidiary temporarily withdrew its application before resubmitting it shortly thereafter. At present, it seems unlikely that HKVAEX intends to resubmit its application. This development aligns with the ongoing efforts of the Hong Kong SFC to regulate the burgeoning crypto industry.
Notably, the SFC of Hong Kong has intensified its scrutiny by flagging major crypto companies like Mexc and Bybit for operating without the necessary licenses within its jurisdiction, labelling them as suspicious virtual asset trading platforms. Moreover, February marked the conclusion of the registration period for crypto firms seeking licensing to operate in Hong Kong. The regulator has consistently cautioned that unregistered entities operating within its jurisdiction must cease their operations by the end of May. In a statement, HKVAEX expressed regret for any inconvenience caused by the closure of its platform.