Huobi is readying launch of its new U.S. affiliate, which will offer custodian services for Huobi’s own U.S. dollar-pegged stablecoin, HUSD.
Nevada-based Huobi Trust Co., a subsidiary of Huobi Tech, will go live by the end of July. Huobi Tech is a Hong Kong-based public company acquired by Huobi founder Leon Lin through a reverse takeover in 2018.
The latest move comes six months after Huobi Trust won a trust license from the Nevada Financial Institutions Division, according to a filing by Huobi Tech with the Hong Kong Stock Exchange in December.
The new trust company will provide custodial and compliance services for crypto firms that have businesses in the U.S. market.
Stable Universal, a U.S.-based stablecoin issuer, teamed up with Paxos to launch HUSD on the Huobi Global trading platform in July 2019.
“We are going to be live in the second week of July and doing a phased transition from Paxos" to Huobi Trust” Rebecca Hirst, chief financial officer at the trust company, told CoinDesk.
The company claimed HUSD surpassed $1 billion in market value on May 20 and has increased by 560% since January. The stablecoin is supported by decentralized finance (DeFi) platforms such as Uniswap, Curve.fi, Cream protocol and the Heco blockchain.
The comeback
Huobi Trust is part of the exchange’s efforts to expand in the U.S. after HBUS, another legal entity affiliated with Huobi Group, ceased operations in December 2019 because of regulatory concerns.
The exchange, which is based in the African island nation of Seychelles, has since been evaluating different ways to reenter the U.S. market, including working with a licensed U.S.-based brokerage firm. The parent group said at the time that upon returning it would make its businesses in the country more compliant with regulations.
The launch of the U.S. trust company also comes at a time when Chinese financial regulators are cracking down on crypto exchanges for trading and mining.
Huobi has suspended some of its trading services for new investors and adjusted its over-the-counter (OTC) trading businesses in the interest of compliance and growth, the exchange said.