Huobi’s Stablecoin Reserves Plummet 30% as Traders Withdraw Millions – Coinpedia Fintech News
August 7, 2023Huobi has seen a 33% drop in its stablecoin reserves over the past week, coinciding with a withdrawal of about $49 million by traders.
The exchange’s main holdings lie in tokens related to the Justin Sun ecosystem, including TRX and HT.
Amidst rumors of top Huobi executives’ detention by Chinese police, a spokesperson for Huobi has denied such allegations.
The past week has been tumultuous for Huobi, a well-known digital asset exchange, as its stablecoin reserves experienced a significant decline of 33%. This decline, as tracked by the data analysis platform Nansen.ai, coincided with traders withdrawing approximately $49 million in stablecoins, raising questions about the stability of Huobi’s reserves amid mounting challenges.
An Unstable Stablecoin Reserve
At the beginning of the year, Huobi proudly reported a balance of $3.1 billion. However, recent figures from DeFiLlama, a popular DeFi tracking site, indicate a sharp drop to approximately $2.5 billion, highlighting the instability in the exchange’s reserves.
Delving deeper into Huobi’s holdings reveals intriguing investment preferences. The exchange’s largest reserves are tied to tokens associated with Justin Sun’s business network, the renowned blockchain entrepreneur.
TRX, the native token of TRON, constitutes a significant 26.5% of Huobi’s holdings. Additionally, the exchange’s proprietary token, HT, makes up 20.32% of the total reserve.
Read More: Justin Sun Clears Huobi Insolvency Rumors – Here’s What’s Happening
Liquid Assets at Hand
Huobi’s portfolio includes approximately $1 billion in easily convertible assets. DeFiLlama’s data highlights Bitcoin as the most liquid asset, accounting for $886.92 million, followed by $48.27 million in USDT (Tether), and $5.41 million in USDC (USD Coin).
Challenges are Escalating!
Adding to the exchange’s turmoil, Chinese blockchain journalist Colin Wu reported the detention of several top executives of offshore cryptocurrency exchanges by Chinese police. Although Colin’s report lacked specific details, it sparked widespread concern within the financial community.
Hong Kong’s financial media outlets reported over the weekend that multiple Huobi executives had been apprehended by Chinese law enforcement. However, a Huobi spokesperson denied these allegations, insisting that there were no arrests among the exchange’s top management, even as outflows from the platform escalated.
Related: Is Huobi Exchange Insolvent? TVL Crashes to $2.5B as Chinese Authorities Start Investigation
In light of these recent events, Huobi appears to be grappling with its fair share of instability and controversy, making its journey in the crypto universe one to watch closely.
Do you think the exchange will be able to weather the storm?
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