Most crypto exchanges have for some time now had challenges operating within the United States. On the other hand, most of the countries in Asia and Europe have taken an initiative of offering straight forward legislation outlining how to conduct any business in the crypto space. But, the U.S. has dropped far much behind in that arena.
Currently, there is no definite framework outlining running businesses and tax payments. Interestingly, there is not even any assurance by the government to pass any laws regarding the cryptocurrency sector.
In that context, Huobi Global announced on November 4 that it plans to freeze all U.S. user accounts by November 13. The exchange has ranked among the largest of its kind in Asia. At some point, they even registered the biggest trading volume than any other crypto exchange in Asia.
But, the company started to look towards global expansion when China and other large Asian countries started cracking down on and heavily regulating digital assets. Huobi opened offices in Korea and followed that up with new offices in Japan.
Due to the uncertainties surrounding the U.S. market, the exchange confirmed that it has been “gradually [disabling]” U.S. accounts. It is preventing trading and transferring with the U.S. users advised to return their borrowed funds from margin trading. Also, users are encouraged to withdraw all assets from the platform.
According to the company’s official blog post, everyone who had bought Huobi’s pre-paid cards will get refunds in USDT. The closure does not mean that Huobi Global will exit the U.S. market. On the contrary, Huobi has come up with a strategic partnership with HBUS, a platform dedicated to serving U.S. customers.
HBUS operates on a separate order book from Huobi Global similar to Binance.US. Thus, it operates independently from the global brand.
This move now finalizes Huobi’s drawn-out shuttering of U.S. accounts. The company keeps on pushing users to the San Francisco-based HBUS. The company has been operating within the U.S. since early 2018 led by Frank Fu who was formerly working with the Chinese photo-editing app Meitu. Huobi said of its main platform:
“Our User Agreement expressly prohibits users in the United States from using our platform.”
The company also stipulated that all the outstanding balances should be withdrawn by November 13. It also offered to help the users holding amounts below the withdrawal minimum through customer support. Customers will get their funds back in the form of USDT or Bitcoin as announced by the company.
Huobi is also ready to refund points gained from card purchases at a 1:1 ratio in USDT. This move is similar to moves made earlier by other international exchanges. Binance did the same by cracking on American users and pushing them to a FinCEN-registered partner.