One of the world’s largest bitcoin exchanges is coming back to life

The deal represents a turning point for Chinese exchanges and wallet services that are seeking a second life in friendlier Asian jurisdictions, such as Japan, South Korea, and Singapore.

As bitcoin sets new highs, China’s cryptocurrency community is feeling low. Following a ban on initial coin offerings, the Chinese government shut down all local crypto exchanges in September, effectively killing bitcoin trading in a country that once dominated the market.

Huobi is one of the biggest victims of the crackdown. Founded in 2013, the Beijing-based exchange at one time accounted for more than 60% of global bitcoin trading, thanks in large part to zero transaction fees and margin trading that lured in China’s risk-loving retail investors.

By the end of September, Huobi, along with other Chinese exchange operators, halted all trading for local customers, following government directives against speculative investment tools.

In the following months, a spokesperson from Huobi rejected numerous interview requests from Quartz, citing the sensitivity of discussing the company’s business plans.

Today, Huobi announced its comeback: the company said (link in Chinese) that it would set up two crypto exchanges in Japan early next year, through a partnership with Japanese financial group SBI.

The deal represents a turning point for Chinese exchanges and wallet services that are seeking a second life in friendlier Asian jurisdictions, such as Japan, South Korea, and Singapore. Huobi will become the first Chinese company to launch centralized exchange services that allow trades between crypto and fiat currencies after the September crackdown.

SBI, formerly a subsidiary of Softbank, was among the first batch of 11 companies granted licenses for operating cryptocurrency exchanges by Japan’s financial watchdog in September, as the country aims to establish itself as an industry hub.

According to SBI’s announcement of the partnership deal (pdf), its agreement with Huobi also includes an equity swap: SBI will acquire a 30% stake in Huobi’s Japanese entity and a 10% stake in Huobi’s South Korean entity. In return, Huobi will buy a 30% stake in Tokyo-based SBI Virtual Currencies, an SBI subsidiary dedicated to crypto exchange services.

At its peak, Huobi had 1.65 million user accounts and recorded daily transaction volumes of over 30 billion yuan ($4.5 billion), according to the announcement. Huobi also operates a peer-to-peer trading platformin Hong Kong that supports crypto-to-fiat transactions and a centralized exchange service for crypto-to-crypto trades—crucial operations for the company since the closure of its mainland trading business.

OKCoin, another leading Chinese exchange, is planning to launch crypto trading platforms in Japan and South Korea through partnerships with local companies, a company spokesperson told Quartz.

Around 30 Chinese exchange operators, or nearly half of the total, have shifted activities overseas after the government crackdown, according to Du Jun, founder of Node Captial, a Beijing-based venture capital firm focusing on the blockchain industry.

“It’s just a beginning,” says Du, who co-founded Huobi. ” A good industry won’t collapse because of crackdowns by a single country, and I don’t think a good entrepreneur will lose his strength because of one country’s restrictions.”

In that sense, Du notes, the Chinese government has unwittingly prompted domestic crypto-entrepreneurs to see the bigger picture and shift their focus to global markets. “Six billion people are always better than 1.3 billion people.”