Huobi, one of the world’s leading cryptocurrency exchanges, has quietly announced the shutdown of its cloud wallet, Huobi Cloud Wallet, formerly known as iToken.
Why Huobi made the decision
The wallet, which allowed users to keep funds on 20 blockchain networks, was ended due to “strategic and product adjustments,” according to the company’s statement. The decision came with no prior announcement on Huobi or iToken’s Twitter pages.
For years, the Cloud wallet was a go-to source for users looking to store their tokens safely without having access to private keys.
However, with the company’s announcement that they’ll be going offline on May 13th, 2023, now is the time for all investors still holding tokens in their wallets to transfer them back into their Huobi balance – or withdraw funds from self-custodial wallets supporting appropriate blockchains.
Those who have yet to do so should act fast; you have three months before your assets become inaccessible! The abrupt decision to shut down the cloud wallet surprised users, who were given no prior warning.
This move is just one sign of distress in the exchange, as Huobi’s market share has decreased drastically in recent years. The company saw its market share recede from 22% to just 4% in 2022, despite being one of the leading global crypto exchanges.
How the company has been doing
The cryptocurrency industry has been highly volatile, and Huobi has not been spared. In January, the company announced that it would cut 20% of its workforce after a surge in outflows.
As a result, the exchange delisted 33 tokens early last month, citing low volume and trading risks as the reasons behind the move. The Singpore-based exchange explained that most of the tokens violated certain sections of its Token Management Rules, including not meeting the requirement of having $50,000 in daily trading volume.
Huobi’s recent move to delist tokens and shut down its cloud wallet may have been motivated by the need to boost profitability. The company is now branching out into other non-linear crypto ventures to remain competitive. For instance, in December 2022, the exchange announced a partnership with payment-facilitating giant Visa.
This partnership involves the launch and issuance of Huobi Visa cards to bridge the gap between mainstream finance and the crypto ecosystem.
The Huobi Visa card is aimed at establishing a more seamless and efficient gateway for user fiat-to-crypto conversions, promoting crypto among Visa’s user base of 3.3 billion people across 200 countries.
Despite these efforts, Huobi’s decreasing market share is a cause for concern. The company’s decision to shut down the cloud wallet may have come at a difficult time, as users are becoming more concerned about security and transparency.
Huobi will need to take decisive steps to regain users’ trust and ensure its services remain competitive in a highly volatile industry.
The company’s decision to shut down its cloud wallet without prior notice may have eroded some of the trust users had in the exchange, especially as it continues to struggle with low market share.
However, the company’s recent partnerships and foray into other crypto ventures show it is committed to remaining competitive in the industry.
