Huobi sees $73.3 million net outflow in past week as investigation rumors swirl

Quick Take

  • Nansen data shows Huobi’s net outflows reached $73.3 million in the past seven days.
  • Hong Kong media reported Saturday, citing two sources familiar with the matter, that at least three Huobi executives were taken into police custody in China.

Cryptocurrency exchange Huobi saw net outflows of more than $73.3 million in the past seven days — a period in which some of its executives were reportedly taken in by Chinese police.

As of 4:30 p.m. HKT time, Huobi recorded an outflow of $505.9 million worth of tokens over the past week with an inflow of $432.5 million, resulting in a net outflow of around $73.3 million, according to data from blockchain analytics firm Nansen.

Outflows appear to be accelerating. In the last 24 hours, Huobi saw a net outflow of $32.9 million, the Nansen data showed. The exchange’s stablecoin balances shrank 33% to $99.47 million over the past seven days, according to the data.

Rumors swirl

The outflows come after Techub News, a Hong Kong-based crypto media outlet, reported Saturday, citing two sources familiar with the matter, that at least three Huobi executives were taken into custody by police in China for investigation.

Jiayin Xie, Huobi’s head of social media, tweeted Sunday that Huobi is rumored to be “invited to tea” every year. The “drinking tea” phrase is widely used in China to describe situations where people are summoned by police or security officers for investigation.

“Faced with these baseless malicious attacks, I feel deeply worried. After some thought, perhaps this is the unavoidable thorny path we must tread upon as we journey back to the top three,” Xie said. 

Huobi advisor Justin Sun tweeted “4” on Sunday, a commonly-used phrase in the crypto community — coined by Binance boss Changpeng Zhao — when faced with so-called FUD (fear, uncertainty and doubt). Sun also retweeted Xie’s earlier post refusing the rumor.

Huobi did not immediately respond to a request for comment from The Block. 

Huobi's financial situation

Meanwhile, Huobi continues to struggle to turn a profit.

The exchange did not post a profit from the third quarter of 2022 to the second quarter of this year, Sun told The Block last week.

Huobi, however, anticipates to break even this quarter and return to profit in the fourth quarter, according to Sun.

This article has been updated with additional information.

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