- Amid rumors of Huobi, a Chinese cryptocurrency exchange, facing investigation by Chinese authorities and potential financial difficulties, the exchange experienced a significant outflow of $64 million.
- Amidst ongoing rumors, the total value locked (TVL) in the exchange has dropped significantly from $3.09 billion to $2.5 billion in the past month.
- Huobi has been closely monitoring all crypto-friendly developments in Hong Kong to operate in the region.
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Is Huobi in Trouble? Inconsistencies in Huobi’s reserves sparked panic within the community, raising concerns about a potential financial crisis; Justin Sun has made a statement regarding the matter.
Huobi Exchange Shaken by Financial Crisis Rumors
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Between August 5th and 6th, popular cryptocurrency exchange Huobi experienced a significant outflow of $64 million amid rumors that Chinese authorities were investigating the exchange’s executives and due to fears of potential financial difficulties.
In the midst of ongoing rumors, the total value locked (TVL) in the exchange has dropped significantly from $3.09 billion to $2.5 billion in the past month. There were rumors that the exchange’s leaders were detained in China on August 4th. According to the rumors, this was due to an investigation related to the exchange’s association with gambling platforms.
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Chinese authorities have been taking stricter measures against cryptocurrency exchanges. Additionally, a senior executive left the exchange, but it is unclear if this is related to investigations in China. Nonetheless, Huobi’s Chief Social Media Officer stated that the exchange is “currently in good shape,” dismissing the rumors.
Claims have been made that the cryptocurrency exchange might be facing financial issues. Fintech executive and angel investor Adam Cochran highlighted inconsistencies in Tether
Data on the blockchain suggests that Huobi had assets of less than $90 million on August 5th, but the most recent “Merkle Tree Audit” claims they held $630 million USDT. Cochran suggests that this situation could imply that Huobi might be facing bankruptcy, potentially lacking the funds to meet its obligations.
Justin Sun Speaks About Huobi’s Bankruptcy Claims
Huobi exchange’s CEO, Justin Sun, responded to rumors about the exchange’s bankruptcy. In a recent tweet, Sun stated, “Ignore the FUD, keep building! Both TRON and Huobi will succeed with continuous development. Trust in our vision and community efforts for a stronger future. Perseverance guarantees success!”
Meanwhile, Huobi has been closely monitoring all crypto-friendly developments in Hong Kong to operate in the region. In February of this year, Huobi also applied for a cryptocurrency trading license in Hong Kong.
News regarding issues with the Huobi exchange has surfaced before. However, Sun and his team continue to maintain transparency by staying engaged and communicative in every situation.