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Huobi, Confirming Justin Sun as Leader, Takes Aim at 'Rat Trading'
The exchange addressed why it has frozen some accounts in the past.
By Helene Braun
Updated May 9, 2023, 4:06 a.m. Published Jan 19, 2023, 9:39 p.m.
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Singapore-based exchange Huobi confirmed Thursday that Justin Sun, founder of Tron, and one of the richest people in crypto, is not just a member of the Global Advisory Board but is leading the exchange.
“Under the leadership of Justin Sun, it can be said that Huobi has embarked on the path to rebirth,” the blog post said.
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Sun became a Global Advisory Board member in October, shortly after Hong Kong-based investment company About Capital Management became the majority stakeholder of Huobi, but it wasn’t previously confirmed that Sun was in charge of the exchange.
The timing has sparked rumors in the industry that Sun might be a shadow investor behind About Capital, but representatives for Sun have told CoinDesk that he is not an owner of the company. Sun himself has confirmed that he owns tens of millions of Huobi’s HT tokens.
Huobi recently came under scrutiny on several fronts, including how it handled its layoffs of around 1,600 people in January.
'Rat trading'
The exchange also addressed concerns of so-called rat trading.
“Several accounts that were frozen for their abnormal behavior are characterized by their lack of trade at normal times,” according to the statement. “However, these accounts have been trading Huobi's new tokens and ecology tokens frequently, while transferring assets in and out quickly. As investigations have shown, these accounts have made abnormal levels of profits many times, and the profits were quickly withdrawn. These are clearly the traits of rat trading.”
Huobi said it has “zero tolerance for rat trading.”
“Under the new management, Huobi will continue to conduct in-depth audits, hold responsible people accountable and publicize information in due time,” according to the statement. “A resolute and consistent crackdown on rat trading demonstrates Huobi's commitment to protecting the interest of its employees and users.”
CORRECTION (13:28 UTC): Clarifies that Justin Sun is the founder Tron, not founder and CEO as stated in an earlier version of this story.
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