Binance is Reportedly Behind New Hong Kong Crypto Exchange Seeking License

Crypto exchange giant Binance seems to have connections with a newly established cryptocurrency trading platform in Hong Kong that has announced its intention to apply for a license in the city, according to a South China Morning Post report. 

The trading platform, known as HKVAEX, was created in December 2022 and launched its trading services in February. 

HKVAE Seeking a License in Hong Kong

SCMP reported that insiders close to the company, who spoke on the condition of anonymity due to the sensitive nature of the information, suggest that Binance is the driving force behind HKVAEX’s efforts to secure a crypto license in Hong Kong.

HKVAEX operates as a separate entity under BX Services Limited in Hong Kong, although the companies are said to share resources. 

The exchange’s website also reveals its utilization of Binance servers for content retrieval.

In response to inquiries regarding its association with Binance, HKVAEX asserted its status as an independent virtual asset exchange platform based in Hong Kong. 

It is operated by a team of technology and financial services professionals who are actively preparing to apply for the Securities and Futures Commission’s virtual asset trading platform license.

Binance Denies Links to HKVAEX

Binance representative explicitly stated that “HKVAEX is not in the Binance Group of companies.” Binance distinguishes its “Binance group” as an ecosystem centered around its online digital assets exchange, separate from “Binance Affiliates.”

The move to establish an independent exchange in Hong Kong may enable Binance to leverage the opportunities presented by a market aspiring to play a greater role in the global cryptocurrency industry. 

This strategy comes at a time when Binance faces mounting legal scrutiny and liquidity challenges in various international markets.

Hong Kong’s implementation of a new licensing scheme this year was designed to attract cryptocurrency industry participants by offering legal stability. 

Numerous exchanges with ties to China have announced their intention to pursue a Hong Kong license since the scheme’s introduction, but Binance, founded in Shanghai in 2017, has largely remained reticent on the matter.

HKVAEX has expressed its readiness to submit an application for Hong Kong’s virtual asset license. The connection between the two exchanges has been scrutinized, with evidence suggesting that HKVAEX, while independently operated, sources from global exchanges, including Binance.

The similarities between Binance and HKVAEX extend to their websites, shared code, and the use of Binance’s content delivery domain.

Additionally, their terms of use display nearly identical templates, raising questions about shared legal resources.