Hbit, an affiliate of the Huobi Group, disclosed that it had $18.1 million on FTX, none of which could be withdrawn. To offset client losses, the business has filed for a $14 million unsecured loan.
Hong Kong-based digital asset platform Hbit Limited is unable to withdraw $18.1 million worth of cryptocurrencies deposited in the now-bankrupt FTX. In a statement to shareholders on Monday, New Huo Technologies Holdings Limited stated that $4.9 million of its subsidiary’s assets were Hbit assets and that the remaining $13.2 million belonged to clients from trading requests.
Huobi also said that it had requested a $14 million unsecured loan to cover the $13.2 million in lost revenue, creating a $32 million liability for the business. According to Huobi, frozen money has no impact on regular business activities. The Huobi Group’s other commercial businesses are unaffected and operate separately from Hbit.
The cryptocurrency sector has been rocked by the collapse of the FTX exchange. Due to FTX’s issues, the cryptocurrency market has fallen, and the community is concerned about how this will affect the overall sector.
Huobi Transparency Report Receives Criticism from Crypto Twitter
Following the collapse of FTX, cryptocurrency exchanges are under intense scrutiny. Concerns were raised when it was reported that Alameda Research, FTX’s sister business, had reserves mostly made up of FTX tokens (FTT). Exchanges have thus been hastily providing evidence of their reserves.
One of them is Huobi, which revealed in a transparency report that the company has reserves of almost $3.5 billion. Huobi tokens make up about 900 million dollars of this total. The majority of the reserves were made up of bitcoin, ether, Tether, and TRX.
Huobi, however, is now under criticism over the report. A connected wallet was seen by some users moving 10,000 ETH to Binance and OKX. Some members of the cryptocurrency community are accusing the exchange of manipulating funds.