Huobi exits Thailand as regulator revokes its operating license
Huobi, the world’s sixth-largest crypto exchange by trading volume, said it will terminate all of its services in Thailand by the end of this month.
The local branch of Houbi, which is branded as DSDack, will permanently cease operations for Thai users on July 1. The statement notes that customers will be able to log in and withdraw their money and assets within a few weeks.
The move comes shortly after Thailand’s Securities and Exchange Commission (SEC) suspended the services of Houbi and revoked its operating license. With the suspension in place, Huobi has been given three months to return all assets to its clients.
Huobi Thailand is based on the original Huobi Cloud Thailand project built by Huobi Cloud and its local Thai partner G.L.T. Huobi Cloud provides only technical product support and brand authorization. The current brand authorization and technical service contracts with Huobi Thailand have expired, and Huobi Cloud will no longer provide support for this project in the future.
Huobi received the cease order after failing to comply with local regulations related to its operations and management structure, the regulator says.
According to the Thai SEC, Huobi had been given an extension to remedy the breach of compliance which was spotted after an investigation in February 2021. Despite the exchange’s request to be given some time to correct the reported failure, it never met the regulatory requirements set by the authorities.
Ultimately, the SEC ruled Huobi’s trading systems, customer asset retention systems and information technology systems as “irreparable” and ordered the exchange to return all assets to its Thai-based customers and clients.
The Southeast Asian nation has already taken steps toward the adoption of cryptocurrencies, rolling out regulations and guidelines to welcome the business and opportunities that blockchain brings. It has also issued improvement orders for Thai cryptocurrency exchanges after users were blocked from trading during significant price spikes.
Last year, Thailand’s securities and exchange commission has published a series of new regulations for crypto businesses, some of which were restrictions that have sparked public outrage. Most recently, it has proposed new guidelines that would govern custody of digital assets held by cryptocurrency operators.
The current rules already require crypto exchanges to share the information of users with regulators, whenever funds are transferred between firms, to curtain a growing number of illicit activities stemming under the guise of the global cryptocurrency industry.
Earlier in 2021, crypto fund managers and investment advisers were also required to apply for a licence to continue their businesses. As things stood before, money managers trading assets that fell outside the legal definition of securities, futures contracts or equivalent financial instruments were not subject to the SEC supervision. Investors in crypto funds managed by unregulated portfolio managers also did not enjoy the protection of investor compensation funds.
