Cryptocurrency

Huobi Crypto Exchange Creates Communist Party Committee

Huobi Crypto Exchange Creates Communist Party Committee

Huobi, currently the fourth-largest crypto exchange in the world, has set up a Communist Party committee within its ranks. This makes Huobi the first blockchain or crypto related business to do so in China, a feat which was hailed as a ‘milestone’ by the CEO and founder Li Lin.

Huobi is following a familiar path

Established in May 2013, Huobi has become a staple of the crypto exchange business, rooted in the top 5 of CoinMarketCap exchange rankings. Following China’s crypto ban last year, the company was forced to relocate its exchange business, which is now based in Singapore. Nonetheless, it still offers blockchain consulting and research services on mainland China. The crypto marketplace has overseen a major expansion in the last 12 months and now operates offices in Korea, Japan, Hong Kong and the United States.

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According to the Communist Party charter, any Chinese company with three or more employees that are party members, must establish its own branch. Such policy was mostly followed only by state-owned companies, however recently the Chinese tech giants have started to implement it. The reason behind it is pretty obvious – to stay on good terms with the Chinese government. Stalwarts such as Tencent, Alibaba, Xiaomi or Baidu have all established similar committees.

South China Morning Post reports that the branch was established through Beijing Lianhuo – a Huobi subsidiary. In turn, it was set up only this April and belongs to Mr. Lin, who owns a 99 percent stake of the company. Upon the announcement, he lavished praise on the Communist party, claiming that its pro-blockchain policy was a big reason for Huobi’s success.

Chinese government: pro-blockchain but anti-crypto

The ruling Communist Party is notorious for its strict stance on crypto. Last year, the government issued a ban on all local and foreign crypto exchanges and initial coin offerings (ICO). This forced a number of prominent crypto companies to relocate their offices either to neighbouring Asian countries or crypto havens like Malta and Switzerland. Also, it is widely speculated that crypto trading it still going strong in China. However, crypto aficionados have been forced to resort to over-the-counter (OTC) markets and secret Telegram channels to do their business.

Curiously, the government has endorsed blockchain tech development and the sentiment is shared by many in China. Earlier this year, way before the crypto crash, Alibaba’s CEO Jack Ma claimed that, “I’m quite bullish about blockchain. Alibaba has been conducting research on blockchain for several years. […] There is no bubble for blockchain, but there’s a bitcoin bubble.“ Alibaba is among the leading companies on a global scale in terms of blockchain R&D, issuing 90 distributed ledger-related patents, according to a recent research.

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