The UK Financial Conduct Authority (FCA) has filed a civil lawsuit in the High Court against HTX (formerly Huobi), a crypto exchange advised by Chinese-American billionaire Justin Sun, accusing the platform of illegally promoting crypto services to British consumers. This was reported by Bloomberg.

The regulator’s statement reads:

“The FCA has commenced civil proceedings in the High Court against HTX, a global crypto exchange, for unlawfully promoting cryptoasset services to UK consumers in breach of the UK’s financial promotions regime. This action is part of our commitment to protect consumers and uphold the integrity of UK financial markets.”

This is the first such prosecution by the FCA against a cryptocurrency company. The regulator stressed that most crypto platforms have responded positively to the new financial rules, but “where we see bad practice, we will not hesitate to act.”

HTX is on the FCA’s warning list of companies that the regulator believes are illegally trying to attract UK users without the necessary authorization.

Back in October 2023, the FCA officially announced that HTX and KuCoin were not licensed to operate in the UK, urging customers to “avoid these platforms.”

According to the law, crypto companies have to register with the FCA to be authorized to operate in the country. The registration procedure involves a review of anti-money laundering (AML) and financial crime control systems, but HTX is not among the nearly 50 companies that have passed this review.

Despite the legal risks, HTX remains among the world’s largest exchanges. In May 2024, the platform surpassed Coinbase for the first time in terms of daily spot trading volumes, which reached $2.15 billion, behind only Binance, Bybit, and OKX.

The UK financial regulator has not yet disclosed the details of the lawsuit, but notes that the case against HTX is a signal to the entire crypto market about the need to comply with financial standards and transparency in the field of digital assets.

In February 2024, Sun publicly confirmed that he had over 28,613 BTC (over $1.6 billion) stored on HTX, demonstrating his personal trust in the platform.