Wu said that the reason is that the Hong Kong SFC requires all applicants for virtual asset trading platform licenses to sign a letter of undertaking that they will not have Chinese mainland users in any region. This requirement is not met by traditional offshore exchanges. OKX had tried to form an industry coalition to oppose the request, but to no avail.

However, industry insiders said that the withdrawn entity can apply again after updating the legal subject or framework in the future, but it should not be able to use a brand similar to the current offshore exchange to apply.

At present, a total of 11 platforms including HKbitEX, PantherTrade, Accumulus, DFX Labs, Bixincom, xWhale, YAX, Bullish, Cryptocom, WhaleFin and Matrixport HK have become licensed applicants.

Hong Kong's move has also drawn criticism. Hong Kong Legislative Council member Qiu Dagen Hong Kong Economic Journal published an article today that the exit of OKX has caused a lot of discussion in the industry, questioning whether Hong Kong has a real determination to develop and embrace Web3, the current applicants (mostly) are very small, Hong Kong cannot retreat to the safety line from the beginning, and vainly want to implement the so-called innovation with no risk at all.