Crypto exchange HKVAEX announces full shutdown amid regulatory pressure, Binance's role questioned
Customers are urged to withdraw their assets by April 30.
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HKVAEX, a Hong Kong-based crypto trading platform allegedly backed by Binance, will completely cease its operations in May, according to a Thursday notice. The decision comes one day after the exchange withdrew its application for a Virtual Asset Trading Platform (VATP) license in Hong Kong.
“We are writing to you to announce that, HKVAEX will commence a phased suspension of services starting from April 1 2024. This will lead to a complete closure of our official website on [May 1 2024],” wrote the exchange.
Starting April 1, HKVAEX will phase out its services, which will lead to the full termination of its website the following month. The exchange has already ceased new registrations and virtual asset deposits.
Trading will end on April 5, with all existing orders being canceled, as noted by HKVAEX. After delisting, HKVAEX will offer support for asset withdrawals until April 30. Customers are urged to withdraw their assets by the end of April.
Established in December 2022, HKVAEX offers crypto exchange services under the name BX Services Limited. The exchange is allegedly linked to Binance after its promotional materials listed Binance as a “partner.” Despite these claims, Binance denies any affiliation with HKVAEX.
HKVAEX filed a license application with the Hong Kong Securities and Futures Commission (SFC) in January this year. However, on March 28, it withdrew its filing, according to a new update from the SFC.
The reason behind HKVAEX’s decision to retract its license application remains in question. Chinese reporter WuBlockchain suggested that this “may include a request to change the audit company” or “insufficient materials.”
The HKVAEX Hong Kong compliant cryptocurrency exchange license applied by Binance's Hong Kong entity BX SERVICES LIMITED has been withdrawn. The reasons for the withdrawal are unclear and may include a request to change the audit company, insufficient materials, etc.…
— Wu Blockchain (@WuBlockchain) March 29, 2024
HKVAEX’s latest move comes amid tightening government scrutiny in Hong Kong.
Earlier this month, the SFC issued a public warning about BitForex, a virtual asset trading platform suspected of fraud. Despite claiming to be based in Hong Kong, the SFC claimed that BitForex had not applied for a license from the SFC for its operations.
The SFC further flagged Bybit for operating without licenses within its jurisdiction, categorizing them as suspicious virtual asset trading platforms.
According to a recent update from the SFC, unregistered virtual asset trading platforms must shut down their business operations in Hong Kong by the end of May.
“Virtual asset trading platforms operating in Hong Kong which have not submitted their license applications to the SFC by February 29 2024 must close down their businesses in Hong Kong by May 31 2024. Investors using these platforms should make preparations early,” stated the SFC.
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