© Provided by TheStreetThe Seychelles-based platform is one of the latest victims of a year-long crisis that has plagued the sector.
This is bad news that the cryptocurrency industry can do without.
These data indicate that the most challenging times of the blockchain-based financial services industry are behind us.
Cryptocurrency exchange Huobi has announced it will reduce its workforce by 20% as part of overall cost-cutting measures to combat falling cryptocurrency prices.
"In the current bear market environment, the weaker group still leads the way," a Hubei spokesman told Reuters news agency.
At the end of October, the company had around 1,600 employees. But since we don't have the final numbers, it's hard to say exactly how many jobs will be cut.
Hobby is a damaged sign.
Huobi is one of the largest cryptocurrency exchanges based in the Seychelles. According to data firm CoinGecko, the platform recorded a trading volume of approximately $318 million in the past 24 hours.
The announcement of the closure affected the local token or cryptocurrency issued by the Huobi ecosystem. HTT is down 7% in the past seven days.
The company was founded in China in 2013, but went into exile after Beijing cracked down on the cryptocurrency industry. As a result, Huobi's consulting and research work is only in mainland China, and its business activities are outside the country. It has offices in Hong Kong, South Korea, Japan and the United States
The company is About Capital Management, headquartered in Hong Kong.
Huobi, like all cryptocurrency exchanges, has faced doubts and insecurities about its strength after the sudden loss of FTX. Founded by Sam Bankman-Fried, FTX, considered one of the most powerful firms in the crypto space after a $32 billion valuation in February, filed for bankruptcy on Nov. 11, unable to meet the high withdrawal demands of its clients.
From then on, the rest of the exchange was filled with suspicion. Binance, the world's largest cryptocurrency exchange, was the subject of several rumors in December that left customers panicking over an estimated $6 billion in withdrawals between Dec. 12 and Dec. 14, a TheStreet spokesperson said at the time. .
Anxiety
These doubts have been reinforced by the decision by accounting firm Mazars to cut ties with all cryptocurrency companies.
In December, Mazars announced it would halt work verifying backup data for entities in the cryptocurrency industry due to "concerns about how the public will view that data."
The goal of a backup audit is to demonstrate that a crypto firm has sufficient backups to resist attacks from its customers and investors. This audit also aims to increase public trust and transparency, as most cryptocurrency companies are unregulated, meaning there is no transparency and investors and customers can only trust what their top executives say .
In an interview with TheStreet, billionaire Mark Cuban warned of the potential impact of illegal business activity, which is expected to seriously damage centralized financial exchanges.
The Dallas Mavericks owner told TheStreet in an email that "the next explosion will likely be the detection and elimination of laundry transactions in centralized exchanges." Tens of millions of dollars are believed to be in circulation, and there is an inflated price for rarely used currencies. I don't understand how so much money is possible.
Laundry business, an illegal practice, which creates artificial demand around a financial product, in this case a token or cryptocurrency, to make a profit. This pump and dump method is common in the cryptocurrency industry.
While many transactions occur in traditional finance, cryptocurrency is particularly well suited for this practice, with nearly 13,000 cryptocurrencies listed, according to data firm CoinGecko. Fraudsters need to identify one or another code from the package to carry out laundry business.
For example, according to a 2022 Forbes study of 157 centralized cryptocurrency exchanges, more than half of bitcoin-related exchange rates are fake.