Why did Huobi file ‘resolution to dissolve’ its entity in China

Why did Huobi file ‘resolution to dissolve’ its entity in China

The stringent crackdown on cryptocurrency businesses and mining in China has led the prominent cryptocurrency exchange, Huobi to shut down its subsidiary functioning in the country. According to the publicly available records, Huobi submitted a ‘Resolution to dissolve’ Beijing Huobi Tianxia Network Technology Co., Ltd.

The notice read:

“On July 22, 2021, Beijing Huobi Tianxia Network Technology Co., Ltd. was dissolved due to a resolution and intends to apply for deregistration with the company registration authority. Creditors are requested to declare their claims to the liquidation team within 45 days from the announcement date.”

The above mentioned subsidiary was founded in 2013 and owned by Li Lin. Lin will also be in charge of the cleaning and processing of liquidation claims.

According to reports, a Huobi spokesperson noted that since the Beijing-based entity “has not had any business operations, it is unnecessary and has applied for cancellation.”

This move by the exchange giant followed OKCoin’s decision to file for dissolution. Nearly a month ago, OKCoin also filed for a ‘Resolution to dissolve’, Beijing Lekuda Network Technology Co., Ltd., founded by OK Group’s Star Xu in 2012. Joining this vast list of exchanges exiting China, BTCChina was among the first businesses to shut shops in the wake of an intensive crackdown by the Chinese government.

Although Huobi did not offer details about the dissolution, it was “committed to its globalization process as it continues to hire employees from countries around the world.” The spokesperson added:

“In addition to allowing Huobi to better service the needs of its many international users, Huobi believes that by doing so, it will also improve its ability to ensure business continuity worldwide.”

Nevertheless, the trading services on the two exchanges should remain unaffected as they moved this service out of China years ago. However, the exchanges may face a tough time in retaining the users located within the country.

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