Huobi, the popular Singapore-based crypto exchange, has announced that it will freeze all US accounts by November 13 due to the particularly stringent regulatory environment that has forced the exchange to prohibit US users.
Huobi Pushes Users to New Independent Platform
In a blog post from the exchange published over the weekend, Huobi has said that its user agreement expressly prohibits US-based crypto traders from using the platform in line with the laws and regulations of the US. The accounts of those users have been gradually disabled in order to prevent any further trading, and traders have been advised to return their borrowed funds in margin trading and withdraw all assets balance. Customers can receive their funds in Bitcoin or USDT, and Huobi also pledged to refund points card purchases at a 1:1 ratio in USDT.
However, this does not mean the end of Huobi in the US. The exchange has advised its users to begin using its “exclusive U.S. strategic partner,” the San Francisco-based HBUS, a platform dedicated to serving US-based customers. HBUS functions in a similar manner to Binance.US, which launched in September, in that it essentially provides the same service as its parent company but operates independently of it, and is authorized for use in the US.
Huobi Token Jeopardised
The closing down of its US accounts could throw Huobi’s native digital asset, the Huobi Token (HT), into jeopardy. As Huobi deprives US citizens of using its platform, it is also preventing them from investing in its coin. Closing such a vast market could affect the value of its cryptocurrency. HT was originally intended to be a stablecoin, backed 1:1 with the US dollar. However, the exchange now says that the coin will be an ERC-20 token, meaning it is built on the Ethereum blockchain.
In order to regulate the supply of HT, Huobi has “burned” over 14 million tokens, bringing the total supply to 310,318,300.
Featured Image: DepositPhotos © firstname.lastname@example.org