Affected by tightening regulations in Hong Kong, Binance-backed HKVAEX will close and give users 30 days to withdraw funds

Hong Kong’s Securities and Futures Commission (SFC) has stepped up scrutiny of cryptocurrency trading platforms under its jurisdiction.

According to a notice on the Securities and Futures Commission (SFC) website, Binance-affiliated HKVAEX exchange is about to close and has withdrawn its application for an operating license in Hong Kong.

The cryptocurrency trading platform, which operates under the name BX Services Ltd, officially withdrew its license application on March 28, approximately three months after it applied to the financial regulator.

Subsequently, on the morning of March 29, the company announced that its services would be "phased suspension and shutdown", giving users less than a month to withdraw their assets before March 30. The official website of HKVAEX will be completely closed on May 1, 2024.

Last year, it was reported that Binance supported HKVAEX’s application to obtain a local cryptocurrency license in the region. The Hong Kong-based entity reportedly shares resources with the exchange, led by Richard Teng, and holds joint events with the major crypto company.

At the time, industry experts warned that Binance’s guilty plea in the United States could affect HKVAEX’s chances of obtaining a license in the Asian country.

It’s unclear whether Binance’s regulatory battles influenced the recent license withdrawal.

At the same time, there are reports that HKVAEX’s application may have been withdrawn due to incomplete documents or other reasons.

It is worth noting that HKVAEX is not the only major applicant to withdraw its application recently. Last month, HTX's Hong Kong subsidiary briefly withdrew its application, only to resubmit it days later. It now appears unlikely that HKVAEX plans to resubmit its application.

This development is consistent with the Hong Kong SFC’s ongoing efforts to regulate emerging industries.

Recently, the China Securities Regulatory Commission has stepped up its scrutiny, flagging well-known cryptocurrency companies such as Mexc and Bybit for operating without licenses within its jurisdiction, classifying them as suspicious virtual asset trading platforms.

Additionally, February marks the end of the registration window for crypto companies seeking to operate in Hong Kong to apply for licenses. The regulator has been warning that unregistered entities within its jurisdiction must shut down their operations by the end of May.

A statement from HKVAEX read:

"We sincerely apologize for any inconvenience caused to you by the closure of our platform. We thank you for your support and trust in HKVAEX and urge users to take appropriate action to withdraw their assets before April 30, 2024."

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