<p>The launch of a crypto exchange named HKVAEX in Hong Kong has raised eyebrows as it appears to be closely connected to the global cryptocurrency giant, Binance.</p><h2 id="header-0">Resource sharing</h2><p>While the two entities do not officially acknowledge any affiliation, they share resources and have some commonalities that suggest a deeper connection, according to a <a href="https://www.scmp.com/tech/big-tech/article/3239020/binance-behind-hong-kong-crypto-exchange-hkvaex-which-seeking-licence-city-sources-say" rel="noopener noreferrer nofollow">report</a> published by the South China Morning Post (SCMP) on Wednesday.</p><p>HKVAEX was established in Hong Kong as an independent entity under BX Services Limited. Despite the absence of shared names, official affiliations, or public statements, several clues point to a connection. The logos of Binance and HKVAEX bear a resemblance, and Binance’s official accounts, as well as CEO Changpeng Zhao (CZ), are among HKVAEX’s followers on social media platform X (formerly Twitter).</p><h2 id="header-1">Gaining a foothold in Hong Kong</h2><p>It’s worth noting that Binance’s services are not available in Hong Kong, which raises questions about the motivation behind establishing an independent entity within the city. While HKVAEX appears to be actively pursuing a virtual asset license in Hong Kong, Binance has been relatively silent about its own licensing plans within the Chinese autonomous territory. This move could potentially provide Binance with a strategic foothold in a market that is becoming increasingly significant for digital asset entities.</p><p>Hong Kong has recently introduced a licensing scheme for digital asset entities, and this development has spurred enthusiasm among such entities to establish operations in the region. Alvin Kan, the Head of Asia at Sei Labs, has noted that Asia is poised to become a major expansion zone for the Web3 sector, with regulatory developments in the US creating opportunities for expansion beyond American borders.</p><p>Stanley Fung, who currently heads up HKVAEX, previously served as the chief of Huobi’s Hong Kong operations until November 2022, according to his LinkedIn profile. His departure from Huobi coincided with the entrance of crypto entrepreneur Justin Sun into Huobi’s management.</p><p>In a company-managed Telegram group, HKVAEX has emphasized its status as an “independent crypto exchange” in Hong Kong, separate from Binance. However, it also revealed that it sources liquidity from Binance. Despite asserting its independence and having its own technical team, there have been instances of collaboration between the two entities in Hong Kong, such as a promotional campaign where Binance was referred to as a “partner” in incentivizing the opening of an HKVAEX account.</p><h2 id="header-2">Changing strategy</h2><p>Binance has faced a series of regulatory challenges in recent times. In May, Binance exited the Canadian market due to new regulations related to stablecoins and restrictions on crypto exchanges. In the US, the two leading regulators have filed lawsuits against Binance, CZ, and related entities, leading to the departure of several top officials from the company.</p><p>The leading global exchange appears to be pursuing a different strategy more recently. It has entered the Japanese and Thai markets through the<a href="https://medium.com/&#64;coinness.gl/binance-japan-sets-out-market-vision-6cf30991d096" rel="noopener noreferrer nofollow"> acquisition</a> of a local entity and a <a href="https://medium.com/&#64;coinness.gl/gulf-binance-secures-thai-digital-asset-license-a43f2da47efe" rel="noopener noreferrer nofollow">joint venture</a> with a local company. While forced out of the Netherlands, its Dutch customers were moved to rival Coinmerce, which <a href="https://x.com/ShiningforceNL/status/1676905771815034882?s&#61;20" rel="noopener noreferrer nofollow">connects</a> to the Binance trading engine and order books.</p><p>The evolving regulatory landscape is reshaping the cryptocurrency industry, and the relationship between Binance and HKVAEX highlights the complexities and strategies adopted by major players in this evolving space.</p>

Binance Behind New Hong Kong Crypto Exchange Pursuing License

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