Huobi - the new trouble spot of the crypto world ?

[DrBeer]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:
-Huobi top executives and TRON developers arrested in China.
-Binance has started a massive sell-off of USDT.
-USDT has been in a mild deprivation for a week now.
-Huobi's balance dropped from $700 to $90 million in a month. -The Merkle Huobi tree (a balance sheet publication introduced after the FTX crash) hasn't been updated in a month.
Steaking USDT with a 4.29% yield is the main source of the problem.

What is the essence of steaking

You buy stUSDT notes with your USDT. Justin Sun is supposed to buy US bonds with them, but as analyst Adam Cochran writes, he doesn't. Instead, investors' USDTs are deposited in the addresses of the exchange and Justin Sun's personal wallets.

He spends them to support his other projects. And in a moment, if everyone wants to withdraw their USDT, Huobi simply won't have the money to process the withdrawal.

This is also the case with ETH. Sun has turned them into stETH. Users think there are 141,000 ETH on the balance in Huobi, but no.

New cryptocrisis or just 1 less exchange on the market ?

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[icalical]

If this is turns out to be true, it will be another cryptocrisis, it will not be as big as FTX since Huobi is not even on the top 10 Exchange, but still Huobi is not a small exchange it will have significant impact on the market. But all of that if the rumor was true, until I write this reply the only news I got is this https://www.cryptopolitan.com/huobi-and-tron-executives-allegedly-arrested/ and it only based on the twitter thread by Adam Cohran. This is not the first time Huobi executive has been allegedly arrested, but the previous allegation has been denied, so I would still be skeptical.

[Jawhead999]

This case has some similarity like FTX where Sam Bankman Fried lied to their customers, but the difference is Huobi not get hacked, while FTX does.

It's really sad if Huobi is become a scam exchange because they never get hacked, they have a good record even though they're not able in the top 3 exchanges. Binance only sell USDT that linked with Tron network, so USDT will not collapse yet.

My answer: just one less exchange.

[DrBeer]

The following news was released on forklog today:
 
Huobi has failed to show a net profit for the past four quarters, but expects to break even in October-December. This was reported to The Block by Tron co-founder Justin Sun, who is credited with controlling the bitcoin exchange.

He did not cite specific values. Sun acknowledged that Huobi spent "too much" on marketing, advertising and salaries, but by now the platform has optimized costs.

With the exception of the previous four quarters, the exchange's operations since its launch in 2013 have been profitable, he added.

https://forklog.com/news/dzhastin-san-priznal-ubytochnost-huobi

[jossiel]

That's why when I've seen that stUSDT on the tron network, I didn't put any interest on knowing it more. I'm a noob on that part and have that impression that it's just like the Luna thing.

Well, it won't be a surprising thing when withdrawals comes through rushing on them and they won't be able to process the quickness of it and then will turn into delay in withdrawals and much worse halt all of it.

[crwth]

Is there any coin to watch out for? Like what to sell of before anything else? Because apparently it could really affect a lot of people especially those who have been investing in something.

I think people can start selling off or withdrawing their assets from Huobi to be safe right?

Maybe it's time for shorting? ^{Not financial advice}

[Huppercase]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:
-Huobi top executives and TRON developers arrested in China.
-Binance has started a massive sell-off of USDT.
-USDT has been in a mild deprivation for a week now.
-Huobi's balance dropped from $700 to $90 million in a month. -The Merkle Huobi tree (a balance sheet publication introduced after the FTX crash) hasn't been updated in a month.
Steaking USDT with a 4.29% yield is the main source of the problem.

What is the essence of steaking

You buy stUSDT notes with your USDT. Justin Sun is supposed to buy US bonds with them, but as analyst Adam Cochran writes, he doesn't. Instead, investors' USDTs are deposited in the addresses of the exchange and Justin Sun's personal wallets.

He spends them to support his other projects. And in a moment, if everyone wants to withdraw their USDT, Huobi simply won't have the money to process the withdrawal.

This is also the case with ETH. Sun has turned them into stETH. Users think there are 141,000 ETH on the balance in Huobi, but no.

New cryptocrisis or just 1 less exchange on the market ?

Its becoming scarier even more with the way things are turning out on USDT and I don't know why USDT decided to give one man monopoly to play with a stable coin that is having lots of critism. At times, I get scared of how Justin Sun deposits into Binance make the news all the time, there are lot of many other institutions that makes big deposit to Binance without making a single news but Sun is always ahead and that is even bad of crypto, one man cannot control those millions, maybe its high time we take precaution with stable coins, another Do kwon might be on the pipeline.

Crytpo has been between few people and I don't find it interesting because if you remove Binance, Kraken, Coinbase, Okex from cryptocurrency, only few will be left and by this, money is only ciirculating between this circus people, but when losses happen, it affect everyone because they don't have their coins under their study, it is the exchanges that control half of the money we have in crypto, we need to cut this tie.

[Faisal2202]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:
-Huobi top executives and TRON developers arrested in China.
-Binance has started a massive sell-off of USDT.
-USDT has been in a mild deprivation for a week now.
-Huobi's balance dropped from $700 to $90 million in a month. -The Merkle Huobi tree (a balance sheet publication introduced after the

DrBeer you really a good doctor means you really did a good research if it is not taken from some source if yes then source links are must. either way to prove the credibility you should add some source links. I hope you will not mind my words. I think Houbi is under great pressure here. And if things go side ways then we might see another big dump but it will be a good opportunity for all buyers of BTC who are still holding a hell lot of fiat just to take god entry.

Even one of my friend was asking me to take entry in market and he was asking when should i take one. My guts are telling my that market will take a dump before 2024 so, i tell him the same but i also told him that its just guts so you have to DYOR. as i am not a perfect trader. But he wanted to hold BTC so i advice him accordingly.

Overall, point is, this is a big threat crypto too, Justin sun was already many times arrested or sued by authorities and his behavior has lifted one of my friend's interest from Tron. When Justin sun lastly punished by authorities to manipulate the price of Tron along with 12 celebrities.

[ZAINmalik75]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:

This is also the case with ETH. Sun has turned them into stETH. Users think there are 141,000 ETH on the balance in Huobi, but no.

New cryptocrisis or just 1 less exchange on the market ?

That's a bad news for crypto industry, i hope things will not become bad due to this. You have made a good post here and it is really a good point which we all should keep in mind before taking entries into market. Overall, Justin Sun is also a very greedy person he did some foolish acts before which caused him to pay huge fine as punishment.

Balance that has dropped from 700$ million to $90 million only in a month is a huge alert for all of us. I hope people will not panic and will not start to withdraw there funds from this exchange because once people got panic then this exchange is gone and it will be another exchange going down but leaving some bad impact on the market and another slight or i think big dump in the market too.

[DrBeer]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:
-Huobi top executives and TRON developers arrested in China.
-Binance has started a massive sell-off of USDT.
-USDT has been in a mild deprivation for a week now.
-Huobi's balance dropped from $700 to $90 million in a month. -The Merkle Huobi tree (a balance sheet publication introduced after the

DrBeer you really a good doctor means you really did a good research if it is not taken from some source if yes then source links are must. either way to prove the credibility you should add some source links. I hope you will not mind my words. I think Houbi is under great pressure here. And if things go side ways then we might see another big dump but it will be a good opportunity for all buyers of BTC who are still holding a hell lot of fiat just to take god entry.

Even one of my friend was asking me to take entry in market and he was asking when should i take one. My guts are telling my that market will take a dump before 2024 so, i tell him the same but i also told him that its just guts so you have to DYOR. as i am not a perfect trader. But he wanted to hold BTC so i advice him accordingly.

Overall, point is, this is a big threat crypto too, Justin sun was already many times arrested or sued by authorities and his behavior has lifted one of my friend's interest from Tron. When Justin sun lastly punished by authorities to manipulate the price of Tron along with 12 celebrities.

Thanks for the assessment. Unfortunately I can't provide any links to official information right now, they just don't exist. But there is information from the outside... But as they say, there is no smoke without fire.
To be honest, until today I didn't know about the "specific scheme" implemented on the Huobi exchange, with "collateral" USDT and ETH and pseudo-tokens stUSDT/stETH, but it really seems quite dubious to me, especially given the information about the misuse of these funds. At the same time USDT became a "hostage of the situation", as the amount was notable.

I don't think this will have a negative impact on USDT in the long term and globally, but there could definitely be some problems in the short term. ETH will not suffer so much, because the amount of "borrowing" in ETH is not that significant.

[Eternad]

Justin Sun is destined to be doomed. He is secretly cashing out money from his scam USDT using his Huobi exchange and other project connected to him. He was once caught cheating on his own giveaway sponsored to Binance.

CZ cutting ties to Sun suggest that the boat is sinking already same with what he did to FTX. CZ is part of it too abut ofcourse no one will believe because of his blind follower. CZ and Justin are milking crypto market with their exchange and scam projects that gathers fund through launchpad.

[bitbollo]

I don't think there is a need to underline it another time... but this is another clear proof of always being careful when using exchanges for staking / holding crypto.I hope that much of this is speculation regarding this exchange will not arm anyone and no user funds are at a risk.

[DrBeer]

Is there any coin to watch out for? Like what to sell of before anything else? Because apparently it could really affect a lot of people especially those who have been investing in something.

I think people can start selling off or withdrawing their assets from Huobi to be safe right?

Maybe it's time for shorting? ^{Not financial advice}

Yes, if the information is now officially confirmed - the mass "escape" from the exchange and withdrawal of funds - is guaranteed. And there will be a very delicate situation - if the assets on cold/hot wallets of the huobi exchange are not enough to cover the demand, this will really lead to the same blow to the crypto market, as we had an example of the recent collapse of another exchange. And what is very bad - Huobi is not a third-rate, local exchange, and this will cause an increase in distrust of cryptocurrency and crypto exchanges in general. In today's situation - it will be clearly not the best event, when the prospects of cryptocurrencies are already not the most stable. At the very least, it may increase the pressure of regulators and/or introduce stricter rules for the market, which obviously will not add to the attractiveness of cryptocurrency either

[tjtonmoy]

Not your key, not your coin. Why don't people understand this? Everything that is centralized is a piece of shit. Even those that are in the top 3. I still don't trust them 100%. When others have control over your assets, anything could happen to them. So I don't wanna hand over my asset's control to someone else. This is a direct red flag for the Huboi exchange. Why are people still using it? Do they not know about it yet or they are just ignorant?

It's not like I don't use CEX. I do, but only when I need to do something in it. When the work is done, I just move my assets to my personal wallet. Learn to take control over your own assets people. It's still not too late. Otherwise, this could be another case like FTX.

[AmoreJaz]

Not your key, not your coin. Why don't people understand this? Everything that is centralized is a piece of shit. Even those that are in the top 3. I still don't trust them 100%. When others have control over your assets, anything could happen to them. So I don't wanna hand over my asset's control to someone else. This is a direct red flag for the Huboi exchange. Why are people still using it? Do they not know about it yet or they are just ignorant?

It's not like I don't use CEX. I do, but only when I need to do something in it. When the work is done, I just move my assets to my personal wallet. Learn to take control over your own assets people. It's still not too late. Otherwise, this could be another case like FTX.

people will only learn their lessons once they lost big chunk of money. so don't expect everyone to follow the protocol of not storing coins inside a CEX. they always do up until that exchange is down or out of business.
with possible scenario of FTX or not, people should always secure their coins by not leaving it in exchanges for long, if they are not seeing themselves to execute a trade very soon.

[Nwada001]

Justin Sun is destined to be doomed. He is secretly cashing out money from his scam USDT using his Huobi exchange and other project connected to him. He was once caught cheating on his own giveaway sponsored to Binance.

CZ cutting ties to Sun suggest that the boat is sinking already same with what he did to FTX. CZ is part of it too abut ofcourse no one will believe because of his blind follower. CZ and Justin are milking crypto market with their exchange and scam projects that gathers fund through launchpad.

Their reason for setting up their business is to make a profit. Launchpad pump and dump of newly listed tokens are ways the exchanges are milking their customers heavily, as I believe they are always the higher players in that game.

For Justin, his means of exploiting the crypto industry are just increasing day by day. I just hope it doesn't crash the entire tron chain some day and put a lot of people under a heavy loss, as that will really be bad for the entire crypto market, adding to all the negative news happening around crypto exchanges.

[Wend]

Not your key, not your coin. Why don't people understand this? Everything that is centralized is a piece of shit. Even those that are in the top 3. I still don't trust them 100%. When others have control over your assets, anything could happen to them. So I don't wanna hand over my asset's control to someone else. This is a direct red flag for the Huboi exchange. Why are people still using it? Do they not know about it yet or they are just ignorant?

It's not like I don't use CEX. I do, but only when I need to do something in it. When the work is done, I just move my assets to my personal wallet. Learn to take control over your own assets people. It's still not too late. Otherwise, this could be another case like FTX.

Just like you, people use it for exchange and trading purposes, no one says they are leaving their money on Huobi or centralized exchanges. But to say we shouldn't use it at all I would doubt it because if you are a trader. How will you make money without using centralized exchanges? None of us trust them 100%, but do we have any other choice not to use them? While we wait for DEXs developers to improve their exchange, we will still have to depend on CEXs if we want to make money in this market.

[arallmuus]

I don't think this will have a negative impact on USDT in the long term and globally,

Probably not but it could create a small spark that will affect the current condition therefore it might affect it in longer term as well. As of now USDT is no longer at exactly $1 peg or atleast close to $0.999 or something so this has shaken up the market unconsciously ( $0.9984 at the time of writing and chart is showing that it dip a bit earlier today ). Anything that affects USDT will affect crypto market as a whole as well because most people are currently holding USDT compared to the other stable coins

[noorman0]

I also discovered that Justin Sun was linked to the curiosity of the public a few weeks ago with its Tron project. Some people on twitter are suspicious about the tron network version's BTC token  parked in a lending protocol seem unbacked. Here the news.

I don't know if this actually has anything to do with this guy, but there's no way he doesn't understand something because damn that's a huge number (60k btc tokens).

[DrBeer]

The waves of problems on Binance have not subsided, as it started with Huobi ...

Unexpected news:
-Huobi top executives and TRON developers arrested in China.
-Binance has started a massive sell-off of USDT.
-USDT has been in a mild deprivation for a week now.
-Huobi's balance dropped from $700 to $90 million in a month. -The Merkle Huobi tree (a balance sheet publication introduced after the FTX crash) hasn't been updated in a month.
Steaking USDT with a 4.29% yield is the main source of the problem.

What is the essence of steaking

You buy stUSDT notes with your USDT. Justin Sun is supposed to buy US bonds with them, but as analyst Adam Cochran writes, he doesn't. Instead, investors' USDTs are deposited in the addresses of the exchange and Justin Sun's personal wallets.

He spends them to support his other projects. And in a moment, if everyone wants to withdraw their USDT, Huobi simply won't have the money to process the withdrawal.

This is also the case with ETH. Sun has turned them into stETH. Users think there are 141,000 ETH on the balance in Huobi, but no.

New cryptocrisis or just 1 less exchange on the market ?

Its becoming scarier even more with the way things are turning out on USDT and I don't know why USDT decided to give one man monopoly to play with a stable coin that is having lots of critism. At times, I get scared of how Justin Sun deposits into Binance make the news all the time, there are lot of many other institutions that makes big deposit to Binance without making a single news but Sun is always ahead and that is even bad of crypto, one man cannot control those millions, maybe its high time we take precaution with stable coins, another Do kwon might be on the pipeline.

Crytpo has been between few people and I don't find it interesting because if you remove Binance, Kraken, Coinbase, Okex from cryptocurrency, only few will be left and by this, money is only ciirculating between this circus people, but when losses happen, it affect everyone because they don't have their coins under their study, it is the exchanges that control half of the money we have in crypto, we need to cut this tie.

Absolutely agree with you, the problems and the CONSEQUENCES can be quite sad.
A blow to USDT is a blow to all stablecoins, as it can start a chain reaction that will lead to excess liquidity and lack of liquidity in bitcoin, for example, due to withdrawal of funds from stablecoins.

And the collapse of its one CRUCIAL exchange - this is an increase in the concentration of money in fewer hands owning the remaining exchanges - is an additional risk, because the growth of "available assets" will be more provoking to illegal schemes and actions. You understand perfectly well what volumes of assets are in the hands of exchanges