on the crypto
Global cryptocurrency exchange Huobi Group is making its return to the United States after an abrupt departure more than a year ago.
Huobi and the dream of the United States
Huobi Tech - a Hong Kong-based publicly traded company acquired by Huobi Group founder and CEO Leon Li via a reverse acquisition in 2018 - said the Nevada Financial Institutions Division has approved a fiduciary license for its 100% subsidiary. % Huobi Trust Company's, according to a decree filed with the Hong Kong exchange.
The license will allow the company to offer custody and compliance services in the US market in early 2021. The move is part of a broader plan by the Huobi Group to launch regulated financial products and services in the US.
How did it re-enter the US market
Huobi US (HBUS), another Huobi Group related entity, ceased operations in December 2019 due to regulatory concerns. Since then, the Singapore-based exchange has been evaluating ways to re-enter the US market.
In April, Ciara Sun, global head of Huobi Group, said the exchange could partner with a fully regulated broker in the United States to manage its operations across the country.
According to a press release, the Nevada-based Huobi Trust Company will be headed by its chief trust officer, Simon Collier, former contract director of the project and global head of asset solutions at HSBC in Hong Kong for over seven years.
Aja Heise, who was previously Prime Trust's chief compliance officer, will lead the trust company's compliance program. He has experience in designing Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) programs for digital asset projects.
"The announcement is a key step in the company's ambitious plans to expand its brand and recognized products to a global audience, as well as its ongoing initiative to establish a suite of regulated financial products and services in the blockchain space," Huobi Tech said.
The US tightens controls for global exchanges
Huobi's move came at a time when U.S. regulators, including the U.S. Department of Justice and the U.S. Securities and Exchange Commission, are imposing tighter scrutiny on international cryptocurrency exchanges that run assets in the country.
HUBS had received licenses in 43 out of 50 states, but some of them allowed the exchange to trade only crypto-to-crypto, not crypto-to-fiat, as is Bitcoin system for example, according to an old FAQ section on the HBUS website.
Binance, the largest global exchange by trading volume, said last June that it was unable to provide services to U.S. citizens until it was sure they were following the terms of use and KYC (Know-Your -Customer) of the exchange.
The exchange then started a U.S.-based business in partnership with California-based cryptocurrency firm BAM Trading Services, which was already registered as an MSB.
