Name Change Imminent for Hong Kong-Listed Huobi Company
All is set for the change of name of one-time China’s flagship cryptocurrency exchange, Huobi. Per a report from renowned crypto and fintech Chinese journalist Colin Wu, the company is set to change its name to New Huo Technology Company Limited. They will precede a general meeting of shareholders of the company which has been scheduled for October 13, 2022.
Huobi is one of the pioneer cryptocurrency exchanges that kicked off operations in China as far back as 2013. The recognized founders of the company are Leon Li and Du Jun. Until 2021, Huobi operated in China and different parts of the world and expanded its services as the cryptocurrency industry grew. The decision to exit China arose from the government’s clampdown on cryptocurrencies and related services.
Leaving China did not come without its consequences, as Chinese users formed a significant part of customers on Huobi’s platform. Considering that the clampdown by the Chinese government also extended to service delivery to Chinese users, it was imminent that Huobi banned Chinese users as well, despite not operating within the geographical region.
It appears that the exit of Chinese users and other associated complications in the current cryptocurrency industry is taking a toll on the Huobi exchange. Thus, it has become imminent for changes to be made, even to the extent of certain degrees of takeover. The initial sign of this overhaul possibility appeared a few months ago when the company affected a mass layoff of its staff members. Then, about 30% of the staff strength of Huobi was laid off to accommodate the impact of banning Chinese users which led to dwindling revenue.
In August 2022, reports emerged of founder Leon Li looking to sell his shares which accounted for over 50% of the total shares in the company. Bloomberg reported that the shares could be valued at as low as $1 billion. Interested buyers were unknown at the time of the report. However, there were rumors that FTX CEO Sam Bankman-Friend and Tron founder Justin Sun were among those showing interest in purchasing the shares.
As the sale rumor thickened, a couple of denials were released. All the parties mentioned in the report released statements debunking the information from the Bloomberg story. On its Twitter handle, Huobi stated categorically that there was no plan in place for the share transfer of major shareholders. The company also assured users of its status and commitment to providing secure and reliable services to its users.
Tron founder, Justin Sun also debunked the story. On his Twitter handle, he posted that there was no engagement on the matters of shares takeover at the time the story was published by Bloomberg. Similarly, FTX CEO Sam Bankman-Friend also debunked the news. He stated that his company was not planning to acquire Huobi.
The latest report by Wu suggests that indeed the Huobi Hong Kong-listed company is being sold. However, he notes that the buyer of the company is yet to be disclosed. A message on his Telegram channel reads as follows;
“Huobi’s Hong Kong-listed Company will change its name to New Huo Technology Holdings Limited and hold a general meeting of shareholders on October 13. The buyer of the Huobi Hong Kong-listed company and the Huobi Global exchange has not yet been disclosed.”
The impact of China’s cryptocurrency ban has been significant across various platforms in the industry. Apart from Huobi, other cryptocurrency companies, especially exchanges were reported to downsize and carry out other cost-cutting procedures. The market is yet to recover and we may not have seen the end of adjustments yet. A confirmation from Huobi will confirm the actual status of the company and its shareholders.