As the Chinese government cracks down on several crypto exchanges catering to traders based in China, many of those customers – and their bitcoin – have been making their way to Binance over the past few days.

Bitcoin flows to Binance from Huobi reached an all-time high since the Huobi chief operating officer, Robin Zhu, allegedly went missing on Nov. 2. According to data provided by CryptoQuant, a total number of 18,652 bitcoin, worth nearly $300 million, was transferred from Huobi to Binance from that day until Nov. 11.

“A lot of users went to Binance because Chinese users are more familiar with Binance and Binance’s executives are all overseas,” Colin Wu, a Chinese crypto reporter behind the Twitter account @WuBlockchain, told CoinDesk on a WeChat message.

A spokesperson from Binance declined to comment on any impact China’s crackdown could have on its business.

For months, Chinese regulators have been clamping down on many crypto trading platforms that cater mainly to Chinese clients. Some of these exchanges appear to have close, albeit informal, relationships with the Chinese government.

The whereabouts of Huobi’s Zhu remains unclear since rumors began circulating in early November that alleged he was arrested by “local officials.” Prices for Huobi Token (HT) dropped to as low as $3.744 on Nov. 3, down 11.3% from $4.22 on Nov. 1, according to Messari.

Over at rival exchange OKEx, with deep ties to China, all withdrawal services remain suspended after it said a holder of a private key needed to authorize withdrawals was out of touch while cooperating with public security investigators in China. OKEx’s native token OKB lost nearly 30% of its market value after the news broke. 

Other exchanges are also feeling the heat. On Nov. 9, the person running TokenBetter, another crypto exchange with mostly Chinese users, was reportedly “under investigation.” TokenBetter’s platform banned its withdrawal service on Oct. 16.

This is not the first attempt by the regulators in China to crack down on crypto exchanges. Bitcoin exchanges received orders to close their businesses in China after the country banned crypto trading activities in 2017. 

Huobi is now based in Seychelles, while OKEx is in Malta. It is unclear where Binance’s main business operations are located – Changpeng Zhao, Binance’s chief executive officer, told CoinDesk his company’s locations are “decentralized.”

Huobi did not answer CoinDesk’s question on where Zhu is currently, but in a WeChat message Ciara Sun, vice president of Huobi Global Markets, wrote that all operations at the company are “normal.” 

“Do not listen to rumors,” she continued. “Huobi reserves the right to pursue legal responsibilities for those who spread rumors.”

Many have associated OKEx’s lost contact with one of its key holders with the arrest of its co-founder Mingxing “Star” Xu. With Huobi’s executive allegedly being arrested, its users are afraid the same things will happen to the Seychelles-based exchange – even though Huobi has guaranteed its users many times it is maintaining normal operations.

China tightens its grip in FinTech

Multiple sources close to OKEx and Huobi told CoinDesk the new crackdown is associated with China’s efforts to fight money laundering and fraud, and it is unlikely to have any connection with China’s rollout of its central bank digital currency (CBDC), the digital yuan.

“[China] doesn’t want digital [renminbi] products to be disruptive to what’s already in the financial system,” Felix Wang, managing director and partner at financial investment research firm Hedgeye, told CoinDesk in an interview. “The government wants to encourage innovation and development. They only want to crack down on products that they think are misleading to the public.”

Crypto exchanges are not the only target of the Chinese regulators in recent months. Perhaps the most well known case was Ant Group’s initial public offering, which was suspended on both the Shanghai and Hong Kong stock exchanges after the company’s founder, Jack Ma, criticized China’s regulators in a speech on Oct. 24.

Is there an upside?

A possible, positive, long-term outcome of the crackdown for exchanges could be that it may encourage the regulators in China to eventually push some sort of a compliance process for crypto exchanges instead of banning them, according to Hao Wang, founder and chief executive officer of Hong Kong-based crypto brokerage CyberX.

“Most of these lost users from Huobi will eventually flow to the white-label exchanges because most traders [in Asia] do not currently have access to trading platforms with regulatory compliance,” Wang told CoinDesk in a WeChat message.

Nonetheless, as China increasingly tightens its grip on its fintech industry, others are also concerned that it will hurt the fintech industry as a whole – blockchain included – as such companies expand their business overseas.

“The sentiment is very bad for all countries outside of China looking to do business with China at this time,” Wang said.“People got worried when [China] introduced those micro financial regulations. They are thinking now this is going to be part of a little step of a bigger crackdown on fintech, finance-related payment and maybe blockchain.”