Hong Kong’s top cryptocurrency retail operator halts trading after FTX fiasco

Genesis Block, a famous crypto retail services company in Hong Kong, announced that it had stopped trading as the effects of the implosion of FTX and liquidity problems at other significant cryptocurrency enterprises are still shaking the sector.

Genesis Block is not associated with Genesis Global Capital, a different participant in the cryptocurrency market that stopped customer cash withdrawals last week.

Genesis Block parts ways with trading on their platform.

According to a client email from the business’s compliance department accessed by Reuters, the corporation, which had run one of Asia’s largest networks of bitcoin ATMs, announced that its over-the-counter trading facility will be shutting down on December 10.

Wincent Hung, the company’s chief executive, explained that they had stopped trading since they were unsure which counterparty would fail next and would prefer to close out all of their positions to reclaim some of their solvency.

According to the email, the business requests that customers cash out and has stopped taking on new clients.

The company was winding down way before FTX’s collapse.

According to three individuals who knew the issue, Genesis Block had already begun winding down its Hong Kong operation before FTX filed for bankruptcy. The company severed relations with the collapsed exchange earlier this month.

According to a source with knowledge of the situation, one Genesis Block executive was formerly a director of FTX Hong Kong but just withdrew from that position. One of the 130 FTX-related businesses supported by Sam Bankman-Fried to file for Chapter 11 bankruptcy in the US is FTX Hong Kong.  Executives at Genesis Block chose not to respond.

A tutorial for purchasing FTT, the native asset of the defunct exchange, through the ATM network, which covers 29 locations in Hong Kong and six in Taiwan, is still available on the Genesis Block webpage.

CoinHero saw the opportunity.

According to the personnel with information about the situation, the ATMs are now run by CoinHero, growing in Hong Kong after Genesis Block sold the company to a third party last year.

Customers can find instructions on purchasing FTT through Genesis Block’s trading platform in Hong Kong on the CoinHero website. Requests for comments from CoinHero still need to be returned. Inquiries on the ATM network have yet to receive a response from Genesis Block.

According to market data source Forex Suggest, the departure of Genesis Block from Hong Kong is one of the cities with the highest proportion of ATMs per capita in the world, highlighting the difficulties in implementing investor safety in the $900 billion cryptocurrency industry.

Business is as usual.

People can effortlessly trade Bitcoin, tether, and dogecoin at trading platforms and ATMs in Hong Kong’s popular Causeway Bay shopping area.

The city’s Securities and Futures Commission (SFC) is now seeking input from the sector on its plan to permit retail trading of digital assets to strengthen Hong Kong’s position as a fintech hub.

Such a step, if approved, would signify a significant easing of the city’s licensing requirements for providers of virtual asset services, which are scheduled to take effect in March 2023. Previously, the SFC had advocated restricting trading to accredited investors exclusively.