Huobi Global (HTX), a major crypto exchange, is facing a setback in its Hong Kong expansion plans. Their subsidiary, Huobi Hong Kong, has withdrawn its application for a virtual asset trading license from the Hong Kong Securities and Futures Commission (SFC) for the second time**. This raises a big question mark over HTX's future in the Asian financial hub.

Just two months ago, Huobi Hong Kong made a second attempt at securing a license after an initial withdrawal. Now, they've pulled the plug again, leaving the SFC and the crypto community scratching their heads.

Hong Kong has been actively courting crypto businesses, aiming to become a major digital asset hub. However, obtaining a license is no walk in the park. The regulatory deadline for existing exchanges to apply was February 29th, 2024, with operations slated to cease for non-compliant firms by June 1st.

So far, only two platforms – HashKey and OSL – have successfully navigated the licensing maze. The SFC is currently reviewing applications from several other global heavyweights, including OKX, Bybit, and Crypto.com.

What's Huobi Hong Kong's hesitation all about? The SFC remains silent on the reasons behind the repeated withdrawals, leaving a cloud of uncertainty hanging over the exchange's commitment to the Hong Kong market. This mirrors the recent departure of HKVAEX, another crypto platform with suspected Binance ties, which shut down operations after withdrawing its own license bid in March.

This latest development throws a wrench into HTX's global ambitions. Ranked among the top five exchanges by trading volume, they had high hopes for their Hong Kong venture. In early 2023, plans were announced to launch Huobi Hong Kong specifically to comply with the city's evolving crypto regulations.

While HTX maintains that Huobi Hong Kong operates independently, the late February resubmission suggests a scramble to avoid the June 1st shutdown.

This back-and-forth with the SFC is a blow to HTX's expansion plans, particularly considering the potential of the Hong Kong market. For Chinese firms that relocated abroad due to Beijing's crypto crackdown, Hong Kong offers a familiar and potentially lucrative landing spot.

Will HTX make a third attempt at securing a license? Only time will tell. But one thing's for sure: their indecisiveness isn't doing their reputation any favors.