Shalini Nagarajan

<div id="highlights-block_6343e236024d3" class="highlights">
 <ul>
 <li>Tron founder Justin Sun is reportedly the core investor of About Capital, which just bought Huobi</li>
 <li>Huobi founder Leon Li had been shopping his stake for more than a year</li>
 </ul>
 
</div>



Huobi Global’s majority shareholder Leon Li has agreed to sell his entire stake in the crypto exchange to Hong Kong-based investment firm About Capital, reportedly spearheaded by Tron founder Justin Sun.



About Capital’s buyout arm will control Li’s stake upon completion of the transaction, the company said in a <a href="https://www.huobi.com/support/en-us/detail/84919491689932" target="_blank" rel="noreferrer noopener">statement</a> on Saturday. Li will no longer be involved in Huobi’s operations. Terms of the deal were not disclosed.



Huobi is one of the world’s largest crypto trading platforms, with analytics unit <a href="https://messari.io/exchanges" target="_blank" rel="noreferrer noopener">Messari</a> ranking the exchange eighth by total volume having processed nearly $111 million in trades over the past 24 hours.



China-based journalist Colin Wu <a href="https://wublock.substack.com/p/exclusive-the-real-buyer-of-huobi" target="_blank" rel="noreferrer noopener">reported</a> on Monday that Tron founder Justin Sun is the core investor in About Capital, implying that he is the real buyer of the stake (which the report pegged at $1 billion).&nbsp;



The <a href="https://www.theverge.com/c/22947663/justin-sun-tron-cryptocurrency-poloniex" target="_blank" rel="noreferrer noopener">controversial</a> crypto <a href="https://cms.blockworks.co/justin-suns-plot-to-divide-ethereum-off-to-rocky-start/" target="_blank" rel="noreferrer noopener">entrepreneur</a> told Wu that he didn&#8217;t participate and later <a href="https://www.theblock.co/post/175867/justin-sun-denies-being-real-buyer-of-huobi-stake-sale-exclusive" target="_blank" rel="noreferrer noopener">reiterated</a> his denial to The Block. Still, he&#8217;s now officially one of <a href="https://www.huobi.com/support/en-us/detail/34919663373190" target="_blank" rel="noreferrer noopener">Huobi’s global advisors</a>, alongside Valkyrie Investment CEO Leah Wald and About Capital founder Ted Chen. Sun has even updated his Twitter bio to reflect his new Huobi title.



Aside from Hong Kong-based fund manager About Capital, Chen also founded China’s hedge fund giant Greenwoods Asset Management.&nbsp;



Sun is said to have been present at Huobi’s event site at the recent TOKEN2049 conference in Singapore. 



Huobi Global is headquartered in Seychelles, according to the company’s <a href="https://www.hb.co.kr/en-us/about/" target="_blank" rel="noreferrer noopener">Korean website</a>. But its regional affiliates appear to have bases in different locations, with Singapore serving as the firm&#8217;s Asian headquarters. 



Huobi says it&#8217;s seeking a new base in Europe, after <a href="https://www.prnewswire.com/news-releases/huobi-begins-migrating-spot-trading-services-to-regulated-entity-in-gibraltar-reflecting-global-commitment-to-compliant-growth-301418248.html" target="_blank" rel="noreferrer noopener">moving</a> its spot trading operations to a subsidiary registered in Gibraltar last November. A Huobi spokesperson wasn&#8217;t immediately available to comment on the matter.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I am very honored to be appointed as a member of the Global Advisory Board of <a href="https://twitter.com/HuobiGlobal?ref_src=twsrc%5Etfw">@HuobiGlobal</a> and work with industry, academic, and policy leaders to help guide and grow this innovative, vibrant, and resilient organization in its latest chapter of global expansion. Full sail ahead. <a href="https://t.co/txZspJaV4Q">https://t.co/txZspJaV4Q</a>&mdash; H.E. Justin Sun🌞🇬🇩 (@justinsuntron) <a href="https://twitter.com/justinsuntron/status/1579186183871287296?ref_src=twsrc%5Etfw">October 9, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



In any case, Huobi says the deal has no impact on its core operations and business management team, but says it will now take on international brand promotion and business expansion projects. That includes the appointment of its new global strategic advisory board, on which Sun now sits.



This isn&#8217;t Sun&#8217;s first foray into crypto exchanges. As part of a different investment group, Sun previously <a href="https://www.coindesk.com/markets/2019/11/12/despite-denials-tron-founder-confirms-investment-in-poloniex-crypto-exchange/" target="_blank" rel="noreferrer noopener">acquired</a> crypto exchange Poloniex in 2019 from stablecoin issuer Circle. He initially denied the buyout.



<h3 class="wp-block-heading">Huobi founder shopped stake long before Justin Sun&#8217;s reported buyout</h3>



During his time as chief, Li would reportedly hand over daily management responsibilities to his deputies for short periods to deal with health-related issues.&nbsp;



The company <a href="https://www.huobi.com/support/en-us/detail/54886961978434" target="_blank" rel="noreferrer noopener">gradually exited</a> its key market of China beginning in September 2021 following Beijing’s crypto ban. Because of the subsequent drop in revenue, Huobi was forced to start slashing 30% of its workforce this year, Wu <a href="https://twitter.com/WuBlockchain/status/1541683658817699842" target="_blank" rel="noreferrer noopener">reported</a>.



It has since spurred expansion in other markets, including Brazil and Turkey, but competitors such as Binance, FTX and OKCoin place higher on the basis of <a href="https://www.coingecko.com/en/exchanges" target="_blank" rel="noreferrer noopener">“Trust Score” rankings</a> on CoinGecko.



Li, the founder and CEO of Huobi Global, had been in talks with investors to sell his majority stake in the exchange for a while now. Bloomberg reported in August that he was only looking to <a href="https://cms.blockworks.co/crypto-moguls-compete-for-huobi-majority-stake-report/" target="_blank" rel="noreferrer noopener">sell 60% of his stake</a>, aiming for a company valuation of between $2 billion to $3 billion.&nbsp;



FTX founder Sam Bankman-Fried and Sun were reportedly among potential investors who discussed the stake sale with Li. But Bankman-Fried denied the rumors, saying FTX was not planning to acquire the exchange.



Sun didn’t return Blockworks’ request for comment by press time.



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Huobi Founder Sells 100% Stake to Justin Sun Fund: Report

Sebastian Sinclair

<div id="highlights-block_630dc74925e4c" class="highlights">
 <ul>
 <li>Huobi Group founder Leon Li was reportedly looking to offload his majority stake for more than $1 billion</li>
 <li>FTX CEO Sam Bankman-Fried and Tron founder Justin Sun were said to have held preliminary talks</li>
 </ul>
 
</div>



Sam Bankman-Fried has dispelled rumors of his crypto exchange FTX acquiring rival Huobi, after reports surfaced earlier this month indicating preliminary talks had taken place.



“Just to be explicit because apparently a lot of people are saying this: No, we are not planning to acquire Huobi,” Bankman-Fried, FTX’s CEO, <a href="https://twitter.com/SBF_FTX/status/1564263100597010438?s=20&amp;t=OkhxccjyfDwQ0qifwzVZeA" target="_blank" rel="noreferrer noopener">tweeted</a> on Monday.



Bloomberg earlier this month reported that Huobi Group founder Leon Li had sought to offload his majority stake for more than $1 billion, which would value the exchange at $3 billion.



<a href="https://cms.blockworks.co/crypto-moguls-compete-for-huobi-majority-stake-report/" target="_blank" rel="noreferrer noopener">Preliminary talks</a> reportedly took place between Huobi and FTX billionaire Bankman-Fried, as well as Tron founder Justin Sun, according to Bloomberg, which cited sources familiar with the matter.



Sun later denied his company would pursue an acquisition. “We have not engaged in any matters related to the Bloomberg story at this moment,” Sun <a href="https://twitter.com/justinsuntron/status/1558013871343824897?s=20&amp;t=sYMZb9Yjj2i3jJVQUqG5yA" target="_blank" rel="noreferrer noopener">tweeted</a>, emphasizing he had not held any negotiations with Huobi Group founder Leon Li.



Li was reportedly seeking a 60% takeover bid of Seychelles-headquartered Huobi. If a buyer was found at its purported valuation, it would be one of the largest crypto deals of the year. 



Huobi investors Sequoia China and Zhenfund were reportedly informed about the potential deal in a shareholders meeting last month.



In any case, industry participants have come to expect buyouts and takeover bids from FTX. The crypto derivatives and spot market exchange has scooped up businesses amid this year&#8217;s depressed market conditions.



FTX acquired Japan’s fintech firm <a href="https://cms.blockworks.co/ftx-acquires-liquid-group-expanding-presence-in-japan/" target="_blank" rel="noreferrer noopener">Liquid Group</a> for an undisclosed sum in February, Canadian crypto trading firm <a href="https://cms.blockworks.co/bankman-fried-belies-bear-bids-for-bitvo/" target="_blank" rel="noreferrer noopener">Bitvo</a> in June, and <a href="https://cms.blockworks.co/ftx-reaches-deal-to-acquire-blockfi-for-up-to-240m/" target="_blank" rel="noreferrer noopener">initiated</a> a complicated bailout of crypto lender BlockFi in July.



FTX also offered to acquire bankrupt lender <a href="https://cms.blockworks.co/ftx-offers-to-bail-out-voyager/" target="_blank" rel="noreferrer noopener">Voyager</a>, which later rebuffed the advance, labeling it a “<a href="https://cms.blockworks.co/voyager-lawyers-clash-with-bankman-fried-over-low-ball-buyout-offer/" target="_blank" rel="noreferrer noopener">low ball bid</a>.”



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Sam Bankman-Fried: No, FTX is Not Acquiring Huobi

<div id="highlights-block_62f61778d47fe" class="highlights">
 <ul>
 <li>Huobi founder seeks a valuation of up to $3 billion</li>
 <li>It’s unclear whether affiliate firm Huobi Technology is part of the stake sale</li>
 </ul>
 
</div>



Leon Li, the founder and CEO of <a href="https://cms.blockworks.co/tag/huobi/" target="_blank" rel="noreferrer noopener">Huobi</a> Global, is in talks with investors to sell his majority stake in the cryptocurrency exchange, <a href="https://www.bloomberg.com/news/articles/2022-08-12/china-crypto-mogul-seeks-to-sell-huobi-stake-at-3-billion-value" target="_blank" rel="noreferrer noopener">Bloomberg reported</a> on Friday, citing unnamed sources.



Li, who co-founded Huobi in 2013, reportedly wants to sell about 60% of his stake. He’s aiming for a valuation between $2 billion to $3 billion, implying that a sale could generate over $1 billion, the report said.



FTX founder Sam Bankman-Fried and Tron founder Justin Sun are among potential investors that have held preliminary discussions with Huobi about the stake sale, it added.



As one of the world’s largest crypto trading platforms, Huobi often sees daily volumes <a href="https://coinmarketcap.com/exchanges/huobi-global/" target="_blank" rel="noreferrer noopener">above $1 billion</a>. The exchange slowly <a href="https://www.huobi.com/support/en-us/detail/54886961978434" target="_blank" rel="noreferrer noopener">pulled out of</a> servicing users in China — previously a hotbed of revenue and clientele — after the country declared crypto-related transactions illegal last year. 



It isn’t clear whether the stake involved includes the company’s Hong Kong-listed affiliate Huobi Technology, which manages digital assets for investors. Huobi Tech’s shares are down 45% so far this year, <a href="https://www.tradingview.com/chart/?symbol=HKEX%3A1611" target="_blank" rel="noreferrer noopener">TradingView</a> data shows.



Huobi, FTX and the Tron Network didn’t return Blockworks’ request for comment by press time.



Some well-positioned venture capitalists and investors considered the recent meltdown in cryptocurrency markets as a buying opportunity for new projects. Periods of turmoil in the market are also seen as the best time to develop new services in the crypto sector.



Bankman-Fried took it upon himself to go on a deal frenzy, announcing agreements to buy <a href="https://cms.blockworks.co/bankman-fried-belies-bear-bids-for-bitvo/" target="_blank" rel="noreferrer noopener">Canadian crypto trading firm Bitvo</a>, as well as <a href="https://www.financemagnates.com/cryptocurrency/ftx-us-to-acquire-embed-to-provide-white-label-brokerage-services/" target="_blank" rel="noreferrer noopener">Embed Financial</a> and <a href="https://cms.blockworks.co/ftx-reaches-deal-to-acquire-blockfi-for-up-to-240m/" target="_blank" rel="noreferrer noopener">BlockFi</a>. He also offered to bail out Voyager Digital, but the bankrupt crypto lender <a href="https://cms.blockworks.co/voyager-lawyers-clash-with-bankman-fried-over-low-ball-buyout-offer/" target="_blank" rel="noreferrer noopener">denied</a> what it termed his “low-ball” bid.



Sun — who prefers to be known as His Excellency after a 2021 diplomatic appointment from the Caribbean island nation of Grenada — said last month he was <a href="https://cms.blockworks.co/sun-says-he-may-spend-5b-to-save-crypto-even-as-usdd-fights-to-hold-peg/" target="_blank" rel="noreferrer noopener">prepared to join</a> Bankman-Fried in offering financial support to companies within the crypto ecosystem, saying that he and the Tron protocol he founded were “ready to serve.” Sun previously acquired a stake in crypto exchange Poloniex and file-sharing pioneer BitTorrent, now called Rainberry, for $140 million.



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