Huobi Plans Staff Layoffs, Rumors of Insolvency Hang in the Air

Huobi Plans Staff Layoffs, Rumors of Insolvency Hang in the Air

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Cryptocurrency exchange Huobi is planning to lay off 20% of its staff amid the crypto market downturn and the fallout from collapsed crypto exchange FTX.

In the latest round of all-over cost-cutting across the crypto industry, crypto exchange Huobi today confirmed to Reuters that the firm plans to lay off about 20% of its staff. Huobi said in a statement to the news agency:

The planned layoff ratio is about 20%, but it is not implemented now. With the current state of the bear market, a very lean team will be maintained going forward.

The statement to Reuters confirms an earlier message from Tron founder Justin Sun, who said that a “structural adjustment” is to start in Huobi soon. Sun, who is a member of Huobi’s global advisory board, said in an internal memo to company staff that the firm has been like “a fire in the crypto winter” despite the worsening macro environment. Huobi is based in Seychelles and has offices in Hong Kong, the United States, Japan, and in South Korea. The company is publicly listed on the Stock Exchange of Hong Kong.

Along with the layoffs, which rumours of have been running wild on Twitter, Sun has also had to address rumours of insolvency. He said in a January 5 Tweet, that business development of the exchange was “good” and the “security of users’ assets will always be fully protected.” Earlier in January, crypto journalist, Colin Wu, reported that Sun had changed employee salaries from being paid in fiat to being either paid in Tether or USD Coin. The journalist also claimed that staff who disagreed with the new payment systems faced being laid off. Sun dismissed these claims saying that Huobi will “fully respect the legal demands of local employees.”

Wu also cited insiders and reported that in December Huobi cancelled end-of-year bonuses and was preparing to cut up to half of its staff.

Crypto Firms Off to a Rocky Start in 2023

Huobi’s announcement does not come as the first for 2023. In the first couple of days of the year, crypto firm Genesis cut 30% of its workforce in a second round of layoffs in less than six months. Silvergate Capital Corp, a crypto-focused bank, cut its workforce by 40% and has been forced to abandon some of its projects.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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