Crypto exchanges, like any other financial platform, are a complicated matter especially when the issue of regulations in various countries comes in and because they are the means by which most people are able to acquire and sell cryptocurrency, the waters have often become murky. For example, cryptocurrency is banned in China but many Chinese nationals use virtual private networks to access exchanges and trade cryptocurrency which is technically in breach of the law and the responsibility is often put on exchanges to make sure that their customers are adhering to laid down regulations.
On a November 3, 2019, crypto exchange Huobi stated that they will, from November 13, 2019, disable all accounts belonging to US customers on the platform.
The Big Freeze
In light of this, the exchange will be giving refunds to users in bitcoin and tether up until the grace period of November 13, 2019. They have also instructed all US users on the platform to return any money borrowed for margin trading and withdraw all the cryptocurrency from the exchange before the date.
The reason for the prohibition of US users is, according to them, due to the American regulatory system. However, the exchange will not be completely abandoning the US market as they have directed users to make use of HBUS, which is their american partner. This is similar to Binance US, which runs independently of Binance itself but caters to be American market. This is rather interesting as it shows just how stringent the American regulatory system is with regards to crypto is and how regulatory systems can drive away business from a country or attract it. Thankfully, US users will not be left completely in the dark as they have strategic partners in the case of HBUS.