Huione Pay shutdown sparks chaos as withdrawals are frozen

Huione Pay has suspended its operations and blocked customer withdrawals, prompting long lines of anxious users outside its headquarters.

The sudden shutdown, which the company said would last until January 5, followed a surge in withdrawal requests that flooded its systems. Tens of thousands of users attempted to access their funds but were faced with locked accounts, limited information, and uncertainty about when their balances would be returned.

Crowds gather as the company cites liquidity pressure

When the shutdown became effective, masses of people gathered around the main office of Huione Pay on Norodom Boulevard. Most of the people who gave speeches in the scene claimed that they had accounts with the platform and could not access the funds after the abrupt stop. Some of them complained that they were not notified in advance and feared incurring long-term financial losses.

A statement printed on the glass doors of the building caught the attention of reporters. The Chinese-written notice confirmed that Huione Pay was facing a run on the bank and could not handle the number of withdrawals being made.

The firm has outlined a deferred repayment scheme, offering customers two options. It will enable users to deposit their money in high-yield wealth products, resulting in full repayment of the principal within 18 months, accompanied by monthly interest. Individuals who reject the investment option will have the option to withdraw money in monthly installments after six months.

The notification also reaffirmed that all Huione Pay service locations would be closed during the suspension period. The company claimed that recent changes in the external market environment had led to an influx of attempted withdrawals, placing the company under strain in terms of liquidity and resulting in delayed repayments.

Huione Pay shutdown follows regulatory actions in Cambodia and abroad

The freeze on operations occurs several months after increased pressure is applied to Huione Pay and its parent company, the Huione Group, in the regulatory sphere. In June 2024, the National Bank of Cambodia suspended Huione Pay’s license for violating financial regulations in the country. The government ordered the company to stop its payment operations, but it was not publicly stated what the violations were.

In May 2024, the Huione Group was again subject to international scrutiny when the U.S. Treasury Department Financial Crime Enforcement Network (FinCEN) listed the group as a money-laundering institution. The order instructed U.S. financial institutions to terminate their correspondent banking and money transmission services related to the group. FinCEN accused the Huione Group of providing laundering services to transnational fraud networks based in North Korea and Southeast Asia, including schemes involving online theft and cryptocurrency investment fraud.

Private-sector platforms made other measures. In November, cryptocurrency exchange Dunamu, which operates Upbit in South Korea, announced that it had shut down over 200 accounts linked to organizations associated with the Huione network in Cambodia. Upbit claimed that internal monitoring systems had uncovered suspicious virtual-asset transactions to transfer funds via the exchange.

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