The Seychelles-based cryptocurrency exchange – Huobi Global – has been in trouble for some time now, resulting in a significant loss of market share. The company has been mired in controversy due to, among other things, closing com-channels, internal comments, and the suspension of various employee benefits. Its market share is also threatened by competing firms.
According to the latest study by data provider Kaiko, Huobi’s market share fell from 22% in 2020 to just 4% by the end of 2022, making it the biggest loser in the cryptocurrency market. Huobi’s quarterly earnings, too He fell down nearly 98% since the second quarter of 2021.
Huobi is in trouble
The cryptocurrency industry is still reeling from the staggering fallout from the FTX empire, and the community is wary of negative developments surrounding other high-profile participants. Hubei is also the latest to experience a crisis of confidence.
Last week alone, it recorded an outflow of more than $100 million in outbound token flows amid bankruptcy fears. Justin Sun, the founder of Tron, a major shareholder of the cryptocurrency exchange, has transferred a total of about $100 million USDC and USDT from Binance to Huobi to boost confidence.
The USDD miner has also proven to be the Achilles’ heel of Sun’s cryptocurrency empire. For context, USDD, issued by Tron DAO Reserve, is intended to fix exchange rates for stablecoins issued on the TRX blockchain. depeg was triggered by the FTX crash and since then it has continued to hover below the $1 mark.
Although USDD claims to have a security rate of more than 200% with Tron, Bitcoin, USDC, and USDT, it has failed to restore its connection. At the time of writing, the US dollar was trading around $0.97.
kaiko research male,
“Looking at the USDD-USDT order books, which is the highest trading pair by volume, we can see that the depth of the market on the long and short sides has always been unbalanced since the beginning of December.”
Research and development increases
It also found that the supply-ask ratio has been below 1 for most of the past month, a trend that indicates significant selling pressure driving the price lower. The relationship has improved slightly since the beginning of the year, with the bid/ask ratio rising above 1, indicating more bids on the order books.
A change in the current sentiment will only occur if there is a change in the structure of the order book. In fact, Caico’s research found that the US dollar could still regain its peg. But this is not the case for Huobi, which still faces “an uphill challenge of regaining market share”.
Sun recently confirmed that Huobi has cut its workforce by 20% in an effort to cope with mounting losses. The exchange will undergo a “structural adjustment”, which is expected to be completed in the first quarter of this year.
Huobi’s Market Share Plummets Amid USDD Depeg Debuts On CryptoPotato.