Stocks of Hong-Kong-Listed Companies of Huobi and OKEX Crash After Suspending Crypto Services

By Bhushan Akolkar
Published May 24, 2021 Updated May 24, 2021
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Stocks of Hong-Kong-Listed Companies of Huobi and OKEX Crash After Suspending Crypto Services

By Bhushan Akolkar
Published May 24, 2021 Updated May 24, 2021

China’s recent crackdown on crypto miners and traders in the country has sent shock waves all across the crypto market. On Sunday, May 23, the crypto market entered a severe correction crashing another 14% as Chinese exchanges started curtailing their services to local Chinese investors.

Soon after Huobi and OKEx announced limiting their services, stocks of Hong Kong-listed companies of these started correcting majorly. It is clear that China’s cryptocurrency regulatory crackdown has far-reaching consequences even outside the crypto market.

Earlier today, stocks of OKEx and Huobi crashed 15% and 20% respectively as fear gripped investors ahead of China’s next crypto policy.

This comes as crypto exchange Huobi confirmed to Reuters that it is planning to suspend its services in Mainland China. Rather it will now focus its services on overseas markets. Not only exchange but crypto mining businesses based out of China are also making a similar move. As CoinGape reported, most of the Chinese crypto miners are moving their rigs to Europe and North America.

As we know, China alone accounts for over 65% of the global mining operations. The Chinese miners hold large amounts of Bitcoin and Ethereum. Thus, the impact on their price is pretty obvious. On the other hand, Chinese investors were active participants in the crypto space contributing around 60% of the trading volume for perpetual contracts. Wu Blockchain points out that coins with heavy Chinese investments felt the most over the last week.

Hong Kong Restricts Crypto Exchange Use to Professional Investors

A recent report from Reuters noted that crypto exchanges operating out of Hong Kong need to get licensed through the local regulators and shall be able to offer services only to professional investors. However, Chinese journalist Wu Blockchain notes that it is nothing new as HK has always required exchanges to have licenses. He further adds:

“Beijing’s crackdown on cryptocurrencies in mainland China does not include Hong Kong. Similarly, Hong Kong’s cryptocurrency policy has nothing to do with mainland China”.

china’s crypto policy shall be keenly observed going further, especially by some of the biggest institutional players who have been dabbling into Bitcoin (BTC) over the last few years.

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Bhushan Akolkar
826 Articles
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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