In a sign that the crypto sector is beginning to focus on staying on the right side of the authorities, the United States-based operations of the cryptocurrency exchange has registered in the category of being a ‘money services business’ with the US government. This announcement comes as they prepare to expand their crypto-to-crypto trading in the near future.
Registration Background
Huobi is one of the largest crypto exchanges based in China, and they were first started back in 2013.
As there has been a lot of with the crypto sector, many companies are looking overseas to expand and safeguard their operations.
The United States Financial Crimes Enforcement Network () updated their on March 21, 2018, and it showcased that HBUS Inc. is now registered with the regulatory body.
It was in January 2018 that the exchange announced they were opening offices in San Francisco, with this being their planned hub for the expansion in the US market.
The founder and CEO of Huobi Group Li Lin detailed in a recent that they were planning to launch their US operations in May 2018, which will include a new US-focused crypto-only exchange platform.
This platform will only be for investors in the United States, and it will be a separate entity to the current Huobi platform called Huobi Pro.
American Expansion
By having an exchange in the US, this is a significant stepping stone to getting a foothold in the global market, which will allow the group to expand into other regions if they so wish.
Once they don’t encounter any regulatory issues, they will find it a lot easier to expand into the likes of Canada, Europe, and Australia.
Of course, just because they are registered with the financial authority in the US doesn’t mean that they don’t have to worry about other issues related to having operations in the country from a regulatory point of view.
Regarding federal legislation in the US, at the moment there is no clear-cut set of regulatory requirements when it comes to platforms for crypto-to-crypto trading. This will pose its own set of challenges to overcome if their operations are to be a success.
With the US Securities and Exchange Commission () ramping up their efforts to crackdown on the crypto sector, they may address the issue of crypto-to-crypto trading in the near future, and Huobi will have to comply with whatever comes from that.
Huobi does have some roadmap they can follow: Poloniex, an exchange by Circle, has similar operations when it comes to crypto-to-crypto trading in the country.
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Thailand’s Finance Minister announced on March 27, 2018, that the country’s military regime is planning to tax cryptocurrency. The move is creating uncertainty in a region which is promoting Singapore to stay ahead and take control of the leadership in the sector.
Cutting out a Slice of the Pie
The country’s military leaders want to impose taxation on cryptocurrencies in the island country in an attempt to prevent the growing industry from being used for illegal activities.
Not only is the regime is looking to tighten the siege on things like money laundering and drug trafficking, but they also appear poised to even profit from the regulations.
As such, the government is now preparing a regulatory framework which will focus entirely on the cryptocurrency industry.
According to , investors dealing with cryptocurrency will have to pay a seven percent value added tax on all of their crypto trades as well as 15 percent extra on capital gains made from speculation.
Bank of Thailand’s ban
The announcement comes a few weeks after the Bank of Thailand’s on cryptocurrencies.
The two events come as proof of the conservative aspect of the military regime which exerts a strong influence on the way the country’s financial policy is conducted.
The former prime minister and chairman of the Thai Fintech Association told Nikkei that the bank’s move was no surprise as the conservative regime is known to be fiscally moderate.
The former official considered that this traditional aspect of the system could also be its demise. Chatikavanij stressed:
“But they have to be cautious not to allow their conservative instincts to result in draconian regulations.”
Cryptocurrency-Related Companies Fleeing
Apart from the nation-wide ban and the tax impositions, Thailand’s crypto environment is going through a rough phase.
As relevant companies and entrepreneurs look to unveil their projects or begin raising capital through Initial Coin Offerings (), many are turning away from the country and registering their startups in other crypto friendly regions such as Singapore.
For instance, , a Thai-South Korean venture which offers decentralized financial services, set up shop in Singapore as a way to circumvent the country’s growing demands regarding the crypto industry.
The firm also announced it was launching an ICO On March 27, 2018, in Bangkok. The company was able to raise $44 million.
Natavudh Pungcharoenpong, one of the company’s co-founders, said the firm was cooperating with a Thai regulator along with the Securities and Exchange Commission Thailand (), to make sure it goes through all the needed compliance.
With the harsh environment for cryptocurrency-related companies in the country, other entrepreneurs have adopted an even more cautious approach.
, another Thai venture that was planning to jump start its project and list its digital coins on exchanges, has opted to postpone it to a later date to avoid the current regulatory uncertainties.
Another hotshot company called are promoting JFin coin launch. According to Nikkei, J Ventures was able to raise $21 million in a 20 hour period during a pre-sale phase in February.
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