In the last seven days, crypto exchange Huobi had a net outflow of over $94.2 million. Nansen’s analytics report indicated that within just 24 hours alone, roughly 60 million dollars abandoned this platform.
Huobi’s surge in net outflows was due to rumors of staff layoffs and financial instability
Nansen’s report uncovered that a considerable portion of withdrawals was linked to Tether (USDT), USD Coin (USDC), and Ether (ETH) from wallets with sizable amounts.
Word quickly spread on Twitter of Huobi’s purported financial insolvency and its subsequent staff layoffs, prompting a massive outflow from the exchange.
A spokesperson from Huobi has declared that the rumors about 40% of its employees being laid off are false. The spokesperson clarified, “the layoff rate is estimated to be 20%, but not yet applied at this moment.” The reported downsizing appears to be a part of Justin Sun’s acquisition and restructuring process for the company.
Investors are still in doubt about Huobi’s future
In response to rumors of the exchange’s financial instability and allegations of staff cuts, Justin Sun strongly asserted that their business is healthy and committed to safeguarding user assets.
Despite Huobi’s vehement disagreement with these rumors, numerous users are still doubtful about the exchange’s future because of Justin Sun’s behavior.
In October 2022, Leon Li handed over his stake in Huobi to a firm connected to Sun. Afterward, many prominent workers at Huobi left abruptly. Allegedly their exits were associated with the corporate restructuring implemented once Sun took ownership.