Prominent crypto exchange Huobi Global has revealed plans to stop providing derivatives trading in New Zealand. The firm made the revelation via a blog post today. As revealed, the crypto exchange will halt its services by August 23.
Huobi subscribers in the country will no longer have access to the service from the proposed date. These services include coin-margined futures, coin-margined swaps, USDT-margined contracts, options, and other exchange-traded products.
According to Huobi, the development comes barely months after it expanded its operation to the coast of New Zealand. Now, the exchange announced the plan to update its user agreement policy to restrict New Zealand users from accessing its derivative trading.
Recall that the exchange expanded its operation to New Zealand last June. It became registered as one of the country’s financial service providers at the New Zealand Companies Office.
The Huobi user agreement restricted only users from 11 countries from all its services. They include the U.S, Canada, Japan, Iran, Singapore, and a host of others. Huobi restricted users from the U.K, Mainland China, and others from its derivatives trading. Now, its latest decision means New Zealand will join the list of countries blocked from its derivatives offering.
Huobi plans to ban all derivatives accounts belonging to New Zealand users. However, the exchange affirms its commitment to carrying out the operation without jeopardizing the safety of its assets.
Huobi founder Leon Li recently announced plans to sell most of Huobi’s controlling shares. Reportedly, it intends to sell for about $3 billion. Now, he is reportedly in talks with several investors to sell off almost 60% of the company.
Li cited the severe market conditions and the emergence of fierce competition as one of the reasons for the takeover. The Founder admitted that he’s pushing for a possible takeover before the end of the month. If the deal scales through, it will become the biggest takeover in the crypto space since the inception of the fierce bear market.
Currently, prominent investors in the industry, like Sam Bankman-Fried and Justin Sun, Tron’s founder, have reportedly considered the possibility of acquiring the stakes.
Not quite long, Huobi Global laid off about 30% of its staff after the Chinese authorities banned crypto transactions in the country. This further slash the revenue generated by the crypto exchange, thus, compelling it into a minor crisis. The exchange lamented that its expenditure is becoming greater than its revenue. In a bid to cut costs, Huobi moved to shut some of its foreign offices.
In early August, the exchange secured regulatory permission from Australian financial regulators. The permit now allows the exchange to function as a digital currency exchange provider in the country. Also, Huobi obtained a license from the Australian Transaction Reports and Analysis Center (AUSTRAC) to provide digital assets services to local customers. The license is to aid the buying, selling, and trading of crypto products on the exchange by users.
The exchange plans to avail “Over-the-counter” services in the country. According to Huobi CFO Lily Zhang, security and compliance with local laws are the exchange’s topmost priorities.
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