OKX has announced the withdrawal of its VASP (Virtual Asset Service Provider) license application in Hong Kong, a decision revealed on Friday.

The crypto exchange stated that this move was made after "careful consideration" of its business strategy, although it did not provide further details on the specific reasons behind the decision when pressed for clarification by The Block.

In compliance with local regulatory requirements, OKX will cease centralized crypto exchange services to residents of Hong Kong by May 31. While the exchange assured users that their funds remained secure, it cautioned that deposits made after this date might not be automatically credited, and existing open orders would be canceled. From May 31 onward, the withdrawal function will be the sole option available to Hong Kong residents until August 31, after which remaining balances will be considered "unclaimed property" under the platform's terms.

The VASP application submitted by OKX to the Hong Kong Securities and Futures Commission on November 16 has been officially withdrawn, as confirmed by the SFC's website. However, the reason for OKX's withdrawal has not been disclosed.

According to the SFC's guidelines, virtual asset trading platforms operating in Hong Kong that have not submitted their license applications by February 29, 2024, must cease their operations in the region by May 31, 2024, prompting investors to make early preparations if they utilize such platforms.

OKX also reassured customers that its OKX Web3 self-custodial wallet, which operates separately from its centralized exchange services, remains unaffected and will continue to be available to local users.

In December 2022, Hong Kong's Legislative Council passed an amendment introducing a licensing regime for cryptocurrency service providers, with the new regulations coming into effect in June 2023. Numerous global exchanges, including OKX, had applied for retail trading licenses. However, OKX's withdrawal of its application aligns it with other crypto exchanges that have recently done the same, such as Gate.io's Hong Kong affiliate Gate.HK, the purportedly Binance-linked HKVAEX, and HTX's Huobi HK.

In January, OKX successfully obtained a VASP license in Dubai and subsequently launched crypto exchange services in Turkey and Australia.