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HT price dips as Huobi exchange denies insolvency but confirms layoffs

By Darius McQuaid

17:06, 6 January 2023

Huobi logo displayed on a phone screen and representation of cryptocurrencies are seen in this illustration photo taken in Krakow, Poland on 28 September, 2021
Huobi has announced it will lay off 20% of its workforce - Photo: Getty Images

Huobi, which claims to be the world’s leading crypto exchange, has announced it is to lay off a fifth of its workforce but has rebutted rumours that it is insolvent, as it suffered $61m (£50m) of net outflows.

The exchange, which claims more than 20 million users, saw its native huobi token (HT) dip 7% in just a couple of hours on the morning of Friday 6 January, to $4.33, before bouncing back to $4.81 and settling at $4.68 by 18:00 GMT, according to CoinMarketCap.

A spokesperson from Huobi told CoinTelegraph “The planned layoff ratio is about 20%, but it is not implemented now.”

The spokesperson added that the allegations that the exchange would be letting go of 40% of its staff “is another falsehood”.

Huobi said: “With the current state of the bear market, a very lean team will be maintained going forward. The personnel optimization aims to implement the brand strategy, optimize the structure, improve efficiency and return to the top three.”

HT to USD

BCH/USD

488.90 Price
+4.360% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 2.50

XRP/USD

0.53 Price
+0.180% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.01168

ETH/USD

3,139.87 Price
+1.470% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 6.00

DOGE/USD

0.16 Price
+0.820% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.0012872

‘Getting paid in stablecoins’

On 4 January, two days before Huobi admitted to reducing the size of its workforce, Colin Wu, a crypto reporter with a focus on the Asian market claimed that the company was changing the salary it offers to employees from fiat currency to stablecoins.

Employees who would not accept this move would be fired, Wu claimed. Additionally, he said, the crypto exchange cancelled all year-end bonuses for 2022.

Justin Sun, the founder of tron (TRX), bought the stake of Leon Li, founder of Huobi and the former majority shareholder in the crypto exchange, towards the end of 2022.

Sun has attempted to calm the markets down, stating via Twitter “There will always be ups and downs, and it's easy to get caught up in the fear, uncertainty, and doubt (FUD) that can come with it.

“But as a leading cryptocurrency exchange, our strategy is to stay focused on the long term and not get swayed by short-term distractions.”

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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