Huobi Turns into Communism in a Bid to Get Support for Its Domestic Businesses | Crypto
It is always interesting to watch how different entities try to find the most suitable way to promote and expand their business in different countries. For example, with a view to fulfill its obligations to the Chinese state, a well-known major cryptocurrency exchange Huobi has created a Communist Party branch.
Business in China
Initially, Huobi, the third largest cryptocurrency exchange platform by trading volume, was founded in China but after the ban imposed by the Chinese government last September, it was decided to move the main business to another country. Being much more crypto friendly, Singapore was chosen as a new home for Huobi.
In April 2018, Huobi established its subsidiary in China that is called Beijing Lianhuo Information Service Co. Ltd. The initial capital amounted to $2.9 million.
Now it is reported that Huobi has set up a Communist Party committee for its Beijing-based branch. This move is considered to be an attempt to get closer to the Chinese government that doesn’t look like having a very positive stance towards crypto.
Companies’ Political Arms
It’s also worth mentioning that the practice of creating a political arm of an organization is a rather common one among the state-owned entities in China. As it is stated in the Chinese law, if a company has more than three employees who are Communist Party members, the company is obliged to establish its own branch.
While the majority of companies that have set up their political arms are owned by the state, recently industry privately-owned giants have also begun to support this tradition to set up their own party committees. Among the supporters of this trend are Baidu, smartphone brand Xiaomi, and Alibaba.
But Huobli has become the first Chinese blockchain company that created its political arm. This move is considered to be a real milestone for the company that may greatly help it to promote its business in the country.
Commmenting the fact of setting up this new committee, Cao Zhou, who is a party official from Beijing’s Haidan district said:
“We must enhance the party’s political leadership, and carry out the party’s principles and policies in private enterprises.”
Though Huobi is putting in a lot of efforts to the development of its activities in China, this country still remains a rather difficult one for the companies working with crypto. Nevertheless, Huobi is actively expanding and developing its business outside its first jurisdiction.
This year, as CoinSpeaker has reported earlier, through its two subsidiaries, Huobi Universal and Huobi Capital, Huobi Group has acquired a controlling stake in a Hong-Kong-based public listed firm – Pantronics Holdings Ltd.
Moreover, a little bit later Huobi Japan Holding has managed to acquire a majority stake in BitTrade, the crypto exchnage owned by a Singaporean entrepreneur.