Cryptocurrency exchanges Huobi and OKEx are forced to narrow the number of services provided for users living in mainland China. Thus, the Huobi cryptocurrency exchange suspended the provision of some services and products in some countries, and also refused to host miners in mainland China.
Both exchanges left the Chinese market in 2017, during the introduction of the last ban in that country. However, many Chinese customers continued to use Huobi and OKEx’s services.
Against the background of the latest news, Huobi and OKEx tokens lost up to 60% in a week. In general, many cryptocurrency miners have begun to shut down operations in China. Due to a recent call from local authorities to tighten policies regarding mining and trading of cryptocurrencies. According to the publication, the mining of digital currencies has already been suspended by two large companies – BTC.TOP and HashCow.
What services has Huobi suspended?
The Seychelles-listed exchange has reportedly suspended trading in futures, margin-based investment instruments and exchange-traded products. We don’t know which jurisdictions are subject to the restrictions.
Huobi also suspended the provision of mining pool services for Chinese residents.
“We are planning a global expansion of Huobi Pool this year. To focus on overseas expansion, we are suspending related services for new users in mainland China”, the company added.
Huobi’s decision comes amid reports that several Bitcoin mining companies have already ceased operations in mainland China following the crackdown by Beijing. And also in connection with the recent dynamic changes in the market, to protect the interests of investors.
The exchange said it will soon provide its customers with more details on what to do with their mining machines.
To be clear, Huobi hasn’t stopped its own mining pools. But rather the shared hosting services that the exchange provides to anyone looking to invest in crypto mining. Hosting sites operate their customers’ mining machines with maintenance services at their facilities, but don’t own any of the mining machines themselves.
The reason for the last fall of the crypto market
Crypto analysts have named the crypto exchange’s statement as the reason for the latest drop in Bitcoin. As Huobi is a major provider of crypto trading services for Chinese crypto investors and owns the eighth largest mining pool in the world with a 4% hash rate of the entire Bitcoin network.
Immediately after news broke that the exchange was suspending some of its services, short-term sentiment readings for Bitcoin plummeted to levels not seen since May 19, followed by a drop in prices.
Consequently, the statement of the crypto exchange became a specific catalyst for the fall. Previously the market was pressured by concerns about the suppression of cryptography in China, the upcoming regulation of cryptocurrency transactions in the United States and the fact that Tesla’s CEO Elon Musk would abandon Bitcoin.