OKX Hong Kong’s VASP License Application Is Now Withdrawn Due To Regulation Concerns

Key Points:

• OKX Hong Kong’s VASP license application has been withdrawn due to regulation concerns.
• Starting May 31, 2024, the exchange will halt centralized trading for Hong Kong users but ensure fund safety and continue withdrawal services.

In a recent statement, OKX, a prominent cryptocurrency exchange, announced that it had withdrawn the application to provide digital asset services in Hong Kong.

OKX Hong Kong’s VASP License Application Was Withdrawn

OKX immediately disclosed the withdrawal of its Virtual Asset Service Provider (VASP) license application. Starting May 31, 2024, OKX will discontinue centralized virtual asset trading services for users in Hong Kong.

The decision comes amidst a wave of regulatory shifts impacting the crypto industry in the region. The exchange revealed its intention to cease operations in Hong Kong, aligning with regulatory requirements and following in the footsteps of other platforms like HKVAEX.

While OKX advised users against depositing funds after May 31, it assured that existing balances would be securely held until August 31, 2024. Any unclaimed assets after this date will be managed according to the platform’s Terms of Service. Additionally, OKX emphasized the continuity of its OKX Web3 self-custodial wallet services for local users, unaffected by the regulatory changes.

Global Regulatory Pressures Shape Cryptocurrency Exchange Strategies

OKX Hong Kong’s VASP license application withdrawal reflects a broader trend within the cryptocurrency industry as exchanges navigate evolving regulatory landscapes globally. Regulatory pressures have prompted exchanges to reassess their operations and compliance strategies and many face scrutiny from authorities.

In Hong Kong, introducing a licensing regime for cryptocurrency service providers in June 2023 has prompted significant industry adjustments. While regulatory clarity is sought, exchanges like OKX are adapting to ensure continued presence and compliance within the market.

OKX Hong Kong’s VASP is not the only applicant withdrawing from Hong Kong. Several other applicants withdrew their applications from the Securities and Futures Commission earlier this month, among them Huobi Hong Kong, Cooperative’s affiliate operating in Hong Kong.

Numerous international exchanges have applied for such permits for retail trading. The SFC has been examining applications from Bybit, Bullish, Crypto.com, OKX, and twenty other cryptocurrency companies. The last of the two exchanges that the SFC authorized was in 2022.