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Digital currencies
TechPolicy

Huobi introduces 24-hour delay on cryptocurrency withdrawals to curb speculative trading

  • Cryptocurrency exchange Huobi has imposed a 24-hour condition before a user can withdraw digital tokens in over-the-counter transactions
  • It said a 36-hour requirement may apply in ‘certain cases’ in which users are ‘potentially subject to higher risks’

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Huobi’s latest action effectively discourages cryptocurrency speculation, while dealing another blow to investors in bitcoin and other digital tokens in China. Photo: Shutterstock
Coco Feng
Huobi, operator of the world’s second-largest cryptocurrency exchange by trading volume, has imposed a 24-hour condition before a user can withdraw digital tokens in over-the-counter (OTC) transactions, effectively discouraging speculation and dealing another blow to cryptocurrency investors in China amid Beijing’s latest crackdown on the sector.

Under the new requirement, traders can only take out their tokens 24 hours after making any cryptocurrency purchase, according to a statement posted on Huobi’s Chinese-language website on Thursday. It also indicated that a 36-hour condition may be needed in “certain cases”.

Such cases refer to a condition in which users are potentially subject to higher risks, as detected by Huobi’s risk control system, a company spokeswoman said on Friday.

The new measure aims to “ensure the safety of users’ assets by effectively avoiding losses caused by the inflow of speculative capital”, according to the company’s statement.

Cryptocurrency exchange Huobi expects the new measure to help protect its users’ assets. Photo: SCMP
Cryptocurrency exchange Huobi expects the new measure to help protect its users’ assets. Photo: SCMP

Huobi’s latest initiative, which covers all users on its platform, comes after the company initially applied a precondition of up to 36 hours for cryptocurrency withdrawals on “certain users” in August last year.

OTC transactions have become the only method for individual Chinese investors to buy bitcoin and other cryptocurrencies with fiat money, following Beijing’s 2013 ban on financial institutions and payment platforms dealing with bitcoin and its 2017 shutdown of cryptocurrency exchanges in the country.
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