Huobi

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Huobi
Huobi-logo.jpg
Founded 2013
Headquarters Seychelles
Key People Leon Li, Founder and CEO; Chris Lee, CFO; Robin Zhu, COO
Products Fintech, cryptocurrency trading services
Twitter @HuobiGlobal
LinkedIn Profile
Facebook Page
Website Huobi

Huobi, headquartered in Seychelles, is the cryptocurrency conglomerate that operates Huobi US, Huobi Japan, and Huobi Korea as well as Huobi Global, one of the world's largest cryptocurrency trading platforms by trading volume as of mid November 2020, according to CryptoCompare and Binance's CoinMarketCap, online data aggregators and reporting services.[1][2] Huobi US ceased trading operations on December 15, 2019.[3]

Overview

Huobi was one of the three early Chinese exchanges that at one time together accounted for 90 percent or more of global bitcoin volume. As the legal conditions for trading bitcoin in China became less amenable, Huobi launched a new brand called "Huobi Pro" from its new headquarters in Singapore.[4] On May 21, 2018, Huobi Pro was rolled out to the European and Asian markets.[5]

In July 2018 Huobi announced that it would accept customers from the U.S. on its "strategic partner" platform owned by a subsidiary, HBUS.[6] Almost a year-and-a-half later, at the beginning of December 2019, Huobi US reported trivial trading volume, less than $1,000 worth of cryptocurrency in the 24-period before 10 a.m. CST.[7] On December 8, 2019, Huobi announced that it was ceasing U.S. operations as of the following Sunday, December 15. At the time of the announcement, it offered a handful of cryptocurrency pairs against U.S. dollar Tether. In a statement on its website, HBUS said it had "to cease operations so that it can return in a more integrated and impactful fashion as part of its ongoing strategic layout."[8]

Huobi branded all of its trading platforms, except those in the U.S., Japan, and Korea, as "Huobi Global" and said that it offered services to customers in 130 countries by December 2018.[9]

Bitcoin "Whales"

Huobi's exchange is known to contain wallets held by at least one bitcoin whale. On September 5, 2019, a massive transaction moved 94,505 bitcoin into an unknown user's wallet. Analysts said that many previous transactions came from users on Huobi's exchange.[10]

One of the world's largest wallets unattributed to any known user is a Huobi wallet originally funded in April 2020.[11][12]

On June 27, 2020, that wallet carried out a transaction of 101,857 BTC (valued around $933 million at the time). The bitcoin in the transaction went to two recipients. The first wallet in the transaction is the second-richest cryptocurrency wallet known to exist, and is owned and held in cold storage by Huobi. It received 96,857 BTC in the transaction. The other wallet received 5,000 BTC.[13]

BitTrade

In the first transaction granting full ownership of a regulated cryptocurrency exchange to a non-Japanese person, Singaporean entrepreneur and investor Eric Cheng announced on May 30, 2018, that his Upper Joy Limited had purchased 100 percent of the shares of BitTrade Co., Ltd., one of 16 cryptocurrency exchanges licensed by the Japanese Financial Services Agency. The deal worth about $50 million included BitTrade's affiliate, FX Trade Financial Co., Ltd.[14] On September 12, 2018, Huobi announced that its subsidiary, Huobi Japan Holding Ltd, had acquired 60% of BitTrade with an eye toward expansion into Japan.[15][16] BitTrade told its customers in early December 2018 that it shortly would re-launch its trading under the Huobi name.[17]

Chinese Blockchain Development Alliance

On December 1, 2019 Huobi China was introduced as a founding member of the Blockchain Services Network Alliance at the First Blockchain Services Network Partner Conference in Hangzhou, China. The alliance is sponsored by the State Information Center, an affiliate of the National Development and Research Commission, a Chinese central planning agency. The network intends to offer blockchain infrastructure services to both domestically and internationally.[18] Huobi China mainly operates as a research firm. As a major international cryptocurrency trading platform, Houbi was thought to be trying to get close to the People's Bank of China which is leading China's cryptocurrency development and also attended the inaugural conference.[19]

Huobi support for Steemit

In February 2020, Steemit entered into a "strategic partnership" with TRON, resulting in TRON gaining considerable influence over the STEEM blockchain's governance. Witnesses within the Steemit community, concerned that TRON's executives and administrators (including Justin Sun) might have gained too much power over the Steem network, implemented a soft fork (Soft Fork 0.22.2) on February 24, deactivating the voting power of a large number of STEEM tokens owned by TRON and Steemit. On March 2, 2020, Huobi allegedly joined Binance and Poloniex to use their collective voting power from STEEM tokens held by the exchanges to undo the soft fork.

Rumors about arrest of COO

Huobi leveraged its social media channels on November 2 and 3, 2020 to push back on rumors that Robin Zhu, the chief operating officer, had been arrested on November 2.[20] The market appeared to be skeptical of the denials as Huobi was beset by large outflows of bitcoin totaling more than 4200 bitcoin on November 2.[21] A decline of about 16% in the value of the Huobi Token over the 48 hours prior to noon Chicago time on November 3 provided a further indication of market sentiment moving against Huobi.[22] On the other hand, Huobi concurrently experienced massive inflows of Tether, reportedly from accounts at Bitfinex.[23]

Products and services

Huobi offers a number of different markets, including an OTC market priced in Chinese yuan, cryptocurrency-to-cryptocurrency trading and margin trading of both futures and swaps. Huobi's most actively traded pairs on its spot markets are bitcoin or another cryptocurrency against U.S. dollar Tether, according to CoinMarketCap, an online data reporting service.[24]

Huobi Cloud

In July 2018, Huobi announced the official launch of Huobi Cloud, a new arm of its business focused on creating a "one-stop solution" for digital asset exchange.[25]

Huobi Cloud will rely on Huobi's existing digital asset exchange platforms to provide its partners tools for setting up their own OTC and currency exchange platforms.[26]

Huobi DM

Huobi announced the launch of its derivatives market, Huobi DM, at a developers conference in New York on November 28, 2018. The contracts were to have weekly, monthly and quarterly settlements and will offer varying degrees of leverage.[27]

In March 2020, Huobi launched a "partial liquidation" function for Huobi DM. The function, when triggered, gradually reduces the user's position instead of liquidating it in one fell swoop. The function also includes a circuit breaker, which stops liquidation when large or unusual market movements are detected by the Huobi platform.[28]

Huobi Australia

Listing ten cryptocurrencies pairs, Huobi Australia launched trading on July 5, 2018.[29] On February 24, 2019, the company announced via Twitter that it had suspended operations in Australia and was consolidating its Australian business within Huobi Global.[30] In its Facebook post Huobi Australia cited poor market conditions as the reason.[31]

HUSD

On November 2, 2018, Huobi introduced "HUSD," which was a portmanteau for four stablecoins supported by Huobi: Paxos (PAX), TrueUSD (TUSD), USDCoin (USDC), and Gemini Dollars (GUSD). The HUSD was to be tradable against Tether (USDT) on Huobi Global. Deposits of any of the four stablecoins were reported as HUSD.[32]

In July 2019, Huobi announced that it was changing the HUSD by replacing it with an ERC-20 token. The new token will be called HUSD but will be issued by Stable Universal Limited, a partially owned subsidiary of Huobi. The new token will be deposited with Paxos Trust Company, which is licensed by the New York Department of Financial Services.[33]

Rumors of blockchain smartphones

In September 2019, The Block, Finance Magnates, and other news outlets published stories about a white paper published by China's state-owned telecommunications company China Telecom about blockchain smartphones that said China Telecom was looking to turn 5G smartphones into individual digital asset management platforms that can be integrated with the Ethereum blockchain. The stories also said that Huobi issued a statement saying that its venture capital arm, Huobi Capital, would be partially funding a blockchain project called Whole Network in which blockchain smartphones would be manufactured. According to the news articles, these smartphones will be purchasable using the Huobi Token, HUSD, which can be awarded to users by watching ads, downloading certain apps, inviting new users, and sharing and distributing content. These smartphones will reportedly have their own app store full of dApps, all of which will be purchasable using HUSD. Huobi's CEO Livio Weng told The Block that this push for blockchain smartphones may be tied to the increased use of mobile devices for cryptocurrency trading. The Block also wrote that these smartphones would become available for purchase in China on September 11, 2019.[34][35] Shortly after news broke of this, Huobi Global made an incredulous post on Twitter, saying, "um...so apparently we launched a smartphone?" with screenshots of several of the articles that circulated the story, implying that the stories were not true.[36]

Derivatives

Huobi introduced trading in perpetual swaps on March 30, 2020. The company said that the swaps, which offer up to 125 times leverage are marked-to-market every eight hours. The company also claimed it had implemented a number of risk management measures to help customers avoid position liquidations and losing their entire margin deposits.[37]

On June 15, 202, Huobi launched bi-quarterly futures contracts adding to the weekly, bi-weekly, and quarterly futures contracts already listed. The first bi-quarterly contract was scheduled to expire on December 25, 2020.[38]

DeFi

In August 2020, Huobi announced the creation of Huobi DeFi Labs, a tech incubator for DeFi research and development projects. The announcement also said that the Huobi Group will allocate "tens of millions of dollars to an initial investment fund" to be managed by the incubator.[39] Huobi also announced that the company had hired Sharlyn Wu, who had formerly led the blockchain division at China Merchant Bank International (CMBI), as the chief investment officer for Huobi DeFi Labs.[40]

Huobi DeFi Labs announced the formation of the Global DeFi Alliance on August 17, 2020 along with the Maker Foundation, Compound, NEST communities, and dYdX. According to the press release the consortium was established ". . . to jointly advance DeFi research and development, promote best practices, and facilitate cross-border collaboration and ecosystem development between East and West." The group planned to expand, especially with the addition of other entities in the DeFi community like wallets, protocols and research institutions as well as traders and financial institutions.[41]

Key People

  • Leon Li - Founder and CEO
  • Chris Lee - CFO
  • Robin Zhu - COO


References

  1. Exchanges. CryptoCompare.
  2. Top Cryptocurrency Spot Exchanges. CoinMarketCap.
  3. Important Notice. Huobi US.
  4. Bitcoin Regulation In China Still Unclear, But Chinese Exchanges Thrive Overseas. Forbes.
  5. Homepage. Huobi.
  6. Crypto Exchange Huobi Opens Registration on New US-Based 'Strategic Partner' Platform. Cointelegraph.
  7. Exchanges Overview. CryptoCompare.
  8. Important Notice – HBUS Cease to Operate. HBUS.
  9. Houbi Global Website. Huobi.
  10. Massive $1 Billion Bitcoin Whale Transaction Makes Waves. Coindesk.
  11. The most secretive Bitcoin wallet just moved nearly $1 billion. Decrypt.
  12. What is the Richest Bitcoin Address?. The Crypto Associate.
  13. Mysterious bitcoin wallet emptied of almost a billion dollars of cryptocurrency. Tech Radar.
  14. Singapore entrepreneur Eric Cheng buys Japanese-licensed FX and cryptocurrency exchange for S$67 million. Asia One.
  15. Global crypto giant Huobi acquires majority stake in Singaporean entrepreneur Eric Cheng's Japanese-licensed cryptocurrency exchange BitTrade. Markets Insider.
  16. Huobi Eyes Japan Expansion With Acquisition of Licensed Crypto Exchange. Coindesk.
  17. Japanese Crypto Exchange BitTrade to Relaunch Under Huobi. Finance Magnates.
  18. Huobi Says It’s Joining a Chinese Government-Led Blockchain Alliance. CoinDesk.
  19. Huobi China joins state-backed Blockchain Alliance. AMB Crypto.
  20. Huobi Denies Rumors a Senior Executive Was Arrested. CoinDesk.
  21. Tweet @cryptoquant_com. Twitter.
  22. Huobi Token Price. CoinGecko.
  23. Huobi says all is fine amid massive USDT exchange deposits and BTC withdrawals. CoinTelegraph.
  24. Huobi Global. CoinMarketCap.
  25. Huobi Launches Service to Build Crypto Exchanges in the Cloud. Forbes.
  26. Official launch of Huobi Cloud. Joining hands with the world’s top partners to develop the Blockchain industry. Huobi Global.
  27. HUOBI DEBUTS CRYPTOCURRENCY DERIVATIVES MARKET PLATFORM. Bitcoinist.
  28. Huobi's derivative platform now includes a circuit breaker function. Huobi.
  29. Huobi Launches Australian Exchange Ahead of Blockchain Investment Plans. CoinTelegraph.
  30. @HuobiAustralia. Twitter.
  31. HuobiAu. Facebook.
  32. Announcement on the Launch of HUSD solution on Huobi Global. Huobi Global.
  33. Huobi Revamps HUSD Stablecoin to Help Power ‘Fiat On-Ramp’. CoinDesk.
  34. Huobi backs blockchain smartphones for cryptocurrency traders, purchasable with Huobi Token. The Block.
  35. China Telecom released "5G era blockchain smartphone white paper". 8btc.com.
  36. Um...So apparently we launched a smartphone?. The Block.
  37. Huobi Launches Perpetual Swaps to Help Traders Exploit Market Volatility. PR Newswire.
  38. Announcement on the Launch of Bi-quarterly Contracts. Huobi.
  39. Huobi Hires Former Banking Giant Executive to Lead New DeFi Fund. Coindesk.
  40. Huobi launches DeFi incubator, sets aside 'tens of millions of dollars' for investments. The Block.
  41. Huobi DeFi Labs Launches Global Alliance to Expand the Decentralized Financial Ecosystem with Cross-Border Collaboration. PR Newswire.