OKX Bows Out of Hong Kong, Withdraws VASP License Bid

To comply with regulatory requirements, OKX said it will discontinue centralized cryptocurrency trading services for Hong Kong residents effective May 31, 2024.

OKX attributed the decision to withdraw the Virtual Asset Service Provider (VASP) license application to “careful consideration” of its business strategy. However, the exchange did not provide further details or specific reasons behind the move.

OKX pullbacks from Hong Kong

In its official photo Blog Following Friday's posting, OKX revealed that customer funds remain safe, and withdrawal services will continue to operate normally.

After May 31, 2024, clients residing in Hong Kong will only be able to withdraw their funds from the platform and will not be able to trade or deposit. It is important to note that OKX's Web3 self-hosted wallet services will remain accessible to Hong Kong users and will not be affected by this change.

The cryptocurrency exchange has advised users to refrain from making any deposits into their OKX account after the deadline. Furthermore, any open orders that are not closed by this date will be cancelled, and the resulting funds will be transferred to their OKX account balance.

“After careful consideration of our business strategy, we have decided to withdraw OKX HK’s VASP license application for the time being. OKX will cease providing centralized virtual asset trading services to Hong Kong residents by May 31, 2024 (Friday) in accordance with regulatory requirements.

OKX submitted its application for a Virtual Asset Service Provider (VASP) license to the Hong Kong Securities and Futures Commission on November 16. But as Certain On the SFC website, the company withdrew its application on May 24 without revealing any reason behind the move.

OKX is not the only one that has gone out of business. In fact, several other applicants, including Hong Kong subsidiary HTX and Hong Kong's Huobi, also withdrew their applications for VASP licenses from the Securities and Futures Commission (SFC) earlier this month.

So far, the regulatory body has only approved two cryptocurrency exchanges to operate legally. The website states that OSL Exchange subsidiary OSL Digital Securities Limited and HashKey Exchange subsidiary HashKey Exchange Limited are the only two entities to have obtained the license.

Indian exit

This development comes two months after OKX informed its users in India that it would stop its services in the country due to local regulations. The cryptocurrency exchange sent out an email on March 21 advising Indian users to close their positions by the end of April.

The move by OKX was prompted by the Indian government's increasing scrutiny and crackdown on global cryptocurrency exchanges operating, which resulted in several entities ceasing operations in the country.