As China continues its crackdown on cryptocurrencies, some companies in the region are not lying low to take the heat. According to a recent report, two Chinese online brokerages have decided to expand their business to include crypto trading abroad. The brokerages will now be competing with trading platforms such as Robinhood in the U.S. market.
CNBC reported on Monday that the two trading platforms – Beijing-based Tiger Brokers and Shenzhen-based Futu – have applied for licenses in the U.S. and Singapore. The license will enable them to carry out cryptocurrency trading activities in the countries.
The move comes amidst Chinese crypto crackdown
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Tiger and Futu brokers are nicknamed Chinese Robinhood due to the size of their trading activities in the country in comparison with Robinhood’s dominance in the U.S.
The move by both brokerages is coming amidst the increased crackdown of cryptocurrency traders and miners in China. Both companies believe their crypto trading business in the country is being threatened, and the alternative is to expand their business abroad.
Chief Financial Officer of Futu Arthur Chen, while speaking to CNBC, stated that since launching its business in Singapore earlier in March, the company has gained over 100,000 paying clients.
Chen added that about 25% of new paying clients in the first quarter were from Singapore and the U.S.
Strong competition from Robinhood
It’s never easy to move to a market where there are competitors who have already established themselves there. That is the situation facing Futu and Tiger Brokers in the U.S.
The platforms will be competing with multiple competitors such as traditional rivals, Interactive Brokers, and Robinhood in the U.S. market. This may not worry the newcomers who are being forced to another market due to the unfavorable situation currently in their base country.
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