When the Chinese government cracked down on a number of cryptocurrency exchanges serving Chinese users, many customers had “rushed Bitcoin into the sea” – transferring money to Binance over the past few days.
$ 300 million worth of Bitcoin has flowed from Huobi to Binance
Bitcoin cash flow from Huobi to Binance has reached an all-time high since Huobi CEO Robin Zhu was reportedly missing on November 2.
According to data provided by CryptoQuant, a total of 18,652 BTC, worth nearly $ 300 million, have been transferred from Huobi to Binance since that day.
Colin Wu, a Chinese crypto reporter using @WuBlockchain Twitter account, shared:
“A lot of users have turned to Binance because the Chinese are more familiar with Binance and the Binance executives are overseas.”
A Binance spokesperson declined to comment on any impact the Chinese crackdown could have on its business.
Over the past several months, Chinese regulators have consistently suppressed and controlled cryptocurrency trading platforms that primarily cater to Chinese customers. Among them, some exchanges are said to have close, albeit unofficial, ties with the Chinese government.
Many exchanges are on the Chinese government’s radar
In a related development, OKEx still suspends withdrawals because of the security of the person holding the private key. OKEx exchange coin OKB has lost nearly 30% of its value after the news was released.
Other exchanges are also on target. On November 9, the CEO of TokenBetter, another cryptocurrency exchange with mostly Chinese users, was said to be “under investigation”. TokenBetter’s platform banned withdrawals on October 16.
This is not the first attempt by the Chinese regulator to crack down on crypto exchanges. Many Bitcoin exchanges have received orders to close their businesses in China after the country banned cryptocurrency trading activities in 2017.
Huobi is currently based in the Seychelles, while OKEx is in Malta. It is not clear where Binance’s main businesses are located. Meanwhile, Binance CEO Changpeng Zhao shared that the exchange is “decentralized”.
Ciara Sun, vice president of Huobi Global Markets, declares that every activity at the company is “normal”:
“Don’t listen to rumors. Huobi has the right to prosecute liability for those who spread false rumors. “
Update: Huobi corrects the latest scandals, the social network Twitter constantly ripples
China tightens FinTech
Many sources close to OKEx and Huobi shared with the press that this new crackdown is related to China’s anti-money laundering and fraud efforts and does not have any connection with the launch of China. digital yuan (CBDC).
Felix Wang, director of Hedgeye, commented:
“China doesn’t want digital products like the digital yuan to disrupt what exists in the financial system. The government wants to encourage innovation and development. They just want to suppress products that they consider misleading to the public. “
Crypto exchanges have not been the only targets for Chinese regulators in recent months. Perhaps the most famous case is the suspension of Ant Group’s IPO on both the Shanghai and Hong Kong stock exchanges after its founder Jack Ma criticized Chinese regulators in a statement. speech on October 24.
Influence on the whole market
According to Hao Wang, founder and CEO of Hong Kong-based crypto brokerage CyberX, a positive and lasting result of the crackdown on exchanges is the Chinese regulator. should establish a legal rule for an exchange, rather than a radical ban.
“Most users exiting Huobi will eventually turn to similar white-label exchanges as the majority of Asian users currently do not have access to legitimate trading platforms by law.”
However, as China tightens on fintech more and more, many fear it will harm an entire fledgling industry – including blockchain – as companies expand their businesses overseas.
“All countries outside China want to do business with this country but are mentally hesitant. They are thinking this will be part of a bigger crackdown on fintech, financial payments and possibly blockchain. “