Digital currency exchange Huobi has reportedly seen total outflows of over $73 million during the last week, a time period in which a few of the firm’s executives were taken into police custody by authorities in China.
Huobi operates one of the largest crypto exchanges in the world, claiming more than 45 million users.
According to available data, Huobi experienced an outflow of over $500 million in crypto tokens during the last 7 days, with an inflow of more than $430 million (leading to a total outflow of about $73 million). This, according to data from Nansen.
And now, outflows seem to be increasing. In just the past day, Huobi experienced a total outflow of nearly $33 million, as per available data.
Notably, Huobi’s stablecoin balances declined by over 30% to just below the $100 million mark in the last week, market data reveals.
These substantial outflows have been reported following an update from Techub News, a HK-headquartered media outlet.
According to sources familiar with the issue, three (or more) Huobi senior management professionals were taken into police custody by law enforcement agencies in China for an apparent probe into the situation.
Jiayin Xie, Head of Social Media at Huobi, said yesterday that Huobi is said to be “invited to tea” each year. The “drinking tea” term is reportedly used by Chinese residents to refer to instances where individuals are called in by authorities for an investigation.
Xie stated:
“Faced with these baseless malicious attacks, I feel deeply worried. After some thought, perhaps this is the unavoidable thorny path we must tread upon as we journey back to the top three.”
Meanwhile, Justin Sun posted “4” via social media, a phrase in the crypto space that’s used when dealing with FUD.
It’s worth noting that Huobi is still unable to make sizable returns. But Huobi is hopeful that it can turn things around in a positive direction in the coming months.
According to Adam Cochran, a professor and crypto researcher, USDT has been selling off, partly due to the ongoing situation with Huobi.
1/16
So why is Tether selling off?
Likely Huobi insolvency.
-Binance started selling off USDT in bulk.
-We found out that Huobi execs (and Tron personnel questioned by police)
-This is not long after Sun's stUSDT launch
-And weird balance shifts at Huobi in the last month pic.twitter.com/f3HViYS93a— Adam Cochran (adamscochran.eth) (@adamscochran) August 5, 2023
He believes there is “likely” a Huobi insolvency.
He pointed out via social media that Binance started selling off USDT in bulk. We have also learned that Huobi execs (and Tron personnel were questioned by police and later maybe even apprehended).
This is not long after Sun’s stUSDT launch and “weird balance shifts” at Huobi in the last month.
He also shared:
“Just like he did with Poloniex, Sun has been using Huobi as a personal piggy bank to earn from user deposits – and he can’t honor the balances there on ETH or USDT if users try and withdraw or sell in bulk…When Binance heard that Huobi/Tron employees were being investigated in relation to actions at Huobi, they started slamming the 3CRV USDT sell into DAI to mitigate their risk. Because Huobi is deeply insolvent.”
This past May, Huobi was the target of regulatory authorities in Malaysia when the crypto exchange was told to stop operating in the country.
