HTX loses liquidity as Binance blocks transfers, thinning ETH book

Binance is cutting HTX off. The world’s largest crypto exchange will stop processing all deposits and withdrawals involving HTX and ten other platforms effective August 23, 2026, a move driven by sanctions compliance that’s already draining liquidity from HTX’s order books.

The ETH trading book on HTX has visibly thinned as the deadline approaches, a preview of the kind of market dysfunction that happens when a major exchange loses its biggest on-ramp overnight.

What’s happening and why

Binance’s decision stems from expanded UK and EU sanctions linked to HTX, its founder Justin Sun, and connections to Russia. The compliance crackdown traces back to a wave of regulatory reviews that began in May 2026, when UK regulators flagged concerns about HTX’s affiliations.

The restrictions don’t just target HTX. Ten other platforms, including Rapira and EXMO, are also on the list. The common thread: all have been caught in the crosshairs of the EU’s 21st Russia sanctions package, which expanded the scope of entities that regulated exchanges must distance themselves from.

As of August 14, no blanket transfer ban is technically live yet. But the market isn’t waiting for the calendar to catch up. Traders are already repositioning, and liquidity providers appear to be pulling back from HTX’s books in anticipation of the August 23 cutoff.

The compliance domino effect

Binance isn’t acting alone. Multiple major exchanges, including OKX, Bybit, and Bitget, have been adjusting their compliance policies in response to the same evolving regulatory landscape since May 2026.

HTX, formerly known as Huobi, has been navigating regulatory headwinds for years. Justin Sun’s involvement has been a persistent lightning rod, and the Russia-related sanctions have only intensified the pressure.

What this means for traders and ETH markets

The immediate impact falls hardest on anyone holding significant positions on HTX, particularly in ETH. A thinning order book means that large sell orders could move the price more dramatically than they would on a deeper exchange.

ETH price dynamics on HTX could start diverging from prices on other major exchanges. If Binance users can’t transfer assets to or from HTX, the arbitrage channel closes and price dislocations become harder to correct.

The next date to watch is August 23, when Binance’s restrictions formally take effect.