Huobi Global, one of the world’s biggest crypto exchanges founded in China, is planning to move its headquarters to the Caribbean, marking the latest migration to the region as regulators around the world crack down on the industry.
Justin Sun, who was appointed to the company’s board in October, said the region’s “super-friendly” crypto stance, common law systems and English language adoption made the countries attractive bases.
“These days, one of the biggest targets we have here is to go all in the Caribbean,” Sun said. Dominica, Panama and the Bahamas were the frontrunners, he added.
The migration would make Huobi the latest big crypto company to move to the Caribbean. Sam Bankman-Fried’s FTX, the world’s second-largest crypto exchange, moved to the Bahamas from Hong Kong last year.
Other crypto firms registered in the region include C-Trade in the British Virgin Islands and PrimeBit in Saint Vincent and the Grenadines. Binance, the world’s largest crypto exchange, is registered in the Cayman Islands, while exchange Crypto.com acquired a licence to operate there in August.
Huobi’s shift would involve encouraging dozens of employees at its Seychelles headquarters to move to the Caribbean. Eventually, it hopes to have up to 200 employees to the region, Sun said. The company currently has about 1,600 staff, he added.
Sun, who is also Grenada’s permanent representative to the World Trade Organization, said that he had met Dominica’s prime minister Roosevelt Skerrit last year and that Huobi would work closely with the country of 72,000 to develop its crypto infrastructure.
In October, Skerrit signed an ordinance making cryptocurrencies on the Tron network, founded by Sun, legal means of payment in the country.
“The Caribbean . . . is a very crypto-friendly community . . . and I believe right now, Dominica is one of the frontrunners,” Sun said. “[Skerrit] is a very tech-savvy person. He understands how crypto and the technology works.”
Henri Arslanian, co-founder and managing partner of crypto hedge fund Nine Blocks Capital Management, said that early moves by Caribbean states such as the Bahamas and Bermuda to roll out regulatory regimes for digital assets helped attract global players in the industry.
Huobi remains among the 10 largest crypto exchanges by daily trading volume, according to cryptocurrency tracker CoinMarketCap, though it has slipped from its No 2 spot after China, once its biggest market, banned cryptocurrency transactions last year.
Sun said that he was “very bullish” on the prospect of China softening its stance, though he had not been in recent contact with regulators there.
Despite the ban, Chainalysis, a US blockchain research group, ranked mainland China as the world’s fourth-largest crypto market by transaction turnover last month.
“The Chinese government leadership is under ongoing changes right now,” Sun said, adding that policies would cool “maybe after Q1 next year”.
Although the company named Singapore its regional base last year, Huobi hopes to expand its presence in Hong Kong, where regulators are exploring legalisation of retail crypto trading and Covid-related travel curbs have eased.
“We all know Hong Kong has a big mainland China advantage,” Sun said, adding that its recent policy shift could serve as a model for mainland China.
“Despite the recent Covid challenges . . . many in the crypto ecosystem hope that Hong Kong can also regain its crypto hub status,” said Arlsanian of Nine Blocks.
“It still has a lot of advantages, like a deep talent pool, an experienced regulator and an active crypto ecosystem.”