HashKey follows Coinbase in opening global exchange in Bermuda

Crypto service provider HashKey Group has joined rival Coinbase in launching a global crypto exchange based out of Bermuda called HashKey Global.

Hashkey Global managing director Ben El-Baz told Bloomberg on April 8 that after it saw Coinbase score a Bermuda license to operate its international exchange, it “looked at all the different options, and we found that to be a very, very suitable and good regulatory regime for us to expand from."

He added after FTX collapsed in 2022, exchange users now “better understand what counterparty risk looks like for exchanges” and believed there was a gap for HashKey Global to combine the “user experience and product experience” of Binance and the “regulatory and safety back end” of Coinbase. 

“Our goal long term within the next five years is we want to be the largest globally compliant exchange in the world.”

El-Baz added that Hashkey Global’s goal is to “surpass [the volume of] what other competitors have been doing in that jurisdiction,” namely Coinbase International, which reported a 24-hour derivatives volume of $539.4 million 

Unlike its Hong Kong-based counterpart, which was the first to win a license to operate in the region, HashKey Global won’t serve Hong Kong, along with China, the United States and a host of other regions.

In January, the Hong Kong-based crypto exchange hit so-called unicorn status after raising nearly $100 million in a Series A funding round at a pre-money valuation of over $1.2 billion.

The exchange said the funds would be put toward its business arms, which include asset management, a blockchain node validation service, a tokenization service and a Web3 incubation arm.

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Over the next six months, the exchange will offer spot and futures trading, staking services, a project launchpad and will “have liquidity providers and market makers who are there on day one to ensure that the market is deep enough,” according to El-Baz.

El-Baz was tight-lipped when asked how much money HashKey fronted for its new exchange effort only saying that it believed it was “adequately capitalized” and that Bermuda has a “very strong awareness of the type of capitalization requirements that are needed for licensed institutions.”

The exchange is, at launch, crypto only. It has 20 cryptocurrencies trading in Tether (USDT) pairs including Bitcoin (BTC) Ether (ETH), USD Coin (USDC) and Dogecoin (DOGE).

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