Crypto exchange Huobi returns to profitability in Q1 after restructuring
According to an Apr. 10 post by Justin Sun, the de facto owner of cryptocurrency exchange Huobi Global, the firm recognized $150 million in revenue during Q1 2023 compared to $120 million in expenditures, resulting in a net income of $30 million. Sun says that “a large number of measures were taken to reduce costs and increase efficiency” during the quarter. For Q2 2023, he projects the exchange will bring $187 million in revenue and $76 million in expenses, with a net income of $110 million.
Huobi was one of the largest cryptocurrency exchanges by volume until the off-boarding of its Mainland Chinese users began in 2021. Its market share subsequently fell from 19% in 2020 to an estimated 2.2% in Q4 2022. Sun, who claims to be an “adviser” at Huobi Global, reportedly purchased 100% of the exchange’s stake from co-founders in November 2022 through his entity About Capital.
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Earlier this year, Huobi Global reportedly laid off 20% of its employees and slashed employment benefits as part of restructuring efforts. A major incident occurred on Mar. 10 when the exchange’s native token, Huobi Token (HT), suffered a flash crash leading to a more than 90% drop in its price within hours.
The token has since recovered most of its losses; however, one major user, who goes by the Twitter handle Lantian666, claims to have lost $4 million due to margin liquidations on HT during the flash crash. Lantian666 says they have yet to receive full compensation from Huobi as a result of the incident despite claims from Sun that all users impacted by the crash will be compensated.
Dear colleagues in the crypto circle, I am the owner of the account that was forcefully liquidated for 4 million dollars on March 10th at 5:00 am by the Huobi platform’s HT pin liquidation. I will continue to share all the details and what Huobi did at that time #ShameonHuobi pic.twitter.com/HzDf7xE2Gv
— nnn (@lantian6666) March 26, 2023