Reports emerged in July 2022 that Huobi founder Leon Li was seeking to sell over 50% of the company due to the challenging regulatory landscape and a market downturn. By November 2022, Li had sold his controlling stake to a buyout firm, which was brokered by About Capital Management HK. Rumors circulated that TRON founder Justin Sun was behind the buyout, spending $1 billion to acquire a 60% stake in Huobi Global. Sun denied these rumors, stating he was only an advisor to the company and not a majority shareholder. However, he has since represented Huobi in a high-level capacity, including announcing a potential merger with Poloniex in November 2022.
Poloniex Integration and Diversification of Crypto Exchanges
ChainCatcher reported in March that Poloniex would merge with Huobi, with Poloniex integrating into Huobi’s operations. While some may see this as a move by Huobi to compete with market leader Binance, Sun believes there is room for many exchanges to operate successfully and that the crypto exchange market will diversify in the long term. Sun cites the changeability of trending tokens, such as Pepe, which has gained a significant market cap in a short amount of time. He explains that unlike the legacy stock market, where major stocks stay exclusively with the same exchange, there is scope for crypto exchanges to ride these trends. Sun believes the industry will become lots of exchanges, listing different assets, with Binance listing mainstream assets like Bitcoin and Ethereum, and Huobi, Poloniex, and other exchanges good at listing innovative assets.
Collaboration with Binance
While some may see Binance and Huobi as competitors, Sun views Binance as one of Huobi’s most important partners due to their extensive collaboration. In a recent interview with the Empire YouTube channel, Sun stated that there is room for many exchanges to operate successfully and that Binance accounts for 50-60% of the market. However, he believes that the crypto exchange market will diversify in the long term, and different exchanges will be good at listing different assets. Sun added that Huobi and Binance will collaborate extensively, indicating that there is no competition between the two companies.