While the Chinese government is cracking down on several cryptocurrency exchanges targeting China-based traders, many of those customers - and their bitcoins - have moved to Binance in recent days.
Huobi and Binance
Bitcoin flows from Huobi to Binance reached an all-time high since Huobi's chief operating officer Robin Zhu passed away on November 2. According to data provided by CryptoQuant, a total of 18.652 bitcoins, worth almost $ 300 million (here the quotation in real time), were moved from Huobi to Binance from that day until November 11.
For months, China's regulators have been cracking down on many cryptocurrency platforms that primarily target Chinese customers. Zhu from Huobi has disappeared since rumors began to circulate in early November that he was arrested by "local officials".
Prices for the Huobi (HT) token fell as low as $ 3,744 on Nov.3, down 11,3% from $ 4,22 on Nov.1, according to Messari. Rival exchange OKEx, which has deep ties to China, suspended all withdrawal services after a holder of a private key needed to authorize withdrawals was found untraceable due to a collaboration with Chinese public security investigators.
OKEx's native OKB token lost nearly 30% of its market value after the news broke. Other exchanges are also experiencing inconvenience in this period. On November 9, the manager of TokenBetter, another crypto exchange with mainly Chinese users, was allegedly placed "under investigation".
TokenBetter has banned withdrawal services since October 16. This isn't the first attempt by Chinese regulators to crack down on cryptocurrency exchanges. Huobi is now based in the Seychelles, while OKEx is in Malta. Regarding Binance, CEO Changpeng Zhao said that his company's headquarters are "decentralized".
China tightens its grip on FinTech
Several sources close to OKEx and Huobi have said that the new crackdown is associated with China's new goals in combating money laundering and fraud, and is unlikely to have any connection with China's launch of its central bank. digital currency (CBDC), the digital yuan.
Cryptocurrency exchanges have not been the only target of Chinese regulators in recent months. Perhaps the best known case is Ant Group's Initial Public Offering (IPO), which was suspended on both the Shanghai and Hong Kong exchanges after the company's founder Jack Ma criticized Chinese regulators in a speech on October 24.
This situation is creating bad sentiment for all countries outside of China looking to do business with China right now. Now many are starting to think this is just a first step in a broader crackdown on fintech, finance-related payments and perhaps blockchain.
