Huobi Backed Firm Fails To Withdraw Nearly $18 Million From FTX Exchange
November 16 2022 - 12:57AM
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Burning flames from the FTX collapse continue as damages spread
throughout the crypto market and industry. FTX is left to
themselves as other firms cannot assist due to the magnitude of
debts incurred by the exchange. Binance initially intended to help
but later acknowledged that the situation was beyond its power.
Meanwhile, the latest reports have revealed that the embattled
crypto firm has filed for Chapter 11 Bankruptcy. The FTX crisis has
plunged many crypto firms into debt and losses, including Huobi’s
subsidiary, Hbit Limited. Related Reading: Bitcoin Shows Strength
As Price Holds Above $16,500; Is This A Bear Trap? Hbit Limited
revealed in an official announcement that it failed to withdraw
$18.1 million worth of assets deposited on FTX. According to the
announcement, $13.2 million out of the total value stuck on FTX
belongs to Hbit’s clients. This is because the firm deposited the
assets on FTX as per clients’ trading requests. The remaining $ 4.9
million belongs to Hbit Limited. However, the firm announced that
it would seek legal assistance and follow the necessary steps to
recover the assets from the collapsed crypto exchange. Impending
Financial Crisis For Hbit According to Hbit’s announcement, the
issue may negatively impact its financial performance if not
resolved accordingly. However, it revealed that the incident does
not affect other business operations of Huobi Group since Hbit is a
separate entity. Therefore, different lines of business of the
group will continue their everyday operations. Contagion fears from
the FTX collapse have spread to other crypto exchanges as the
majority are experiencing increased selling pressure. Crypto.Com is
one of the crypto exchanges facing such challenges. CRO, the native
token of Crypto.com, is down by 45% after suffering a massive
sell-off since the FTX fiasco. It started with rumors that the
crypto exchange might be a victim of the ongoing liquidity crunch.
But the CEO of Crypto.Com, Kris Marszalek, dismissed the rumors,
claiming they recovered $990 million from FTX. Marszalek assured
users that Crypto.Com maintains a strong balance sheet. He added
that his firm’s exposure to the newly collapsed exchange is at most
$10 million. Update On The FTX Crisis According to the FTX
bankruptcy filing, the exchange valued its assets between $10 and
$50 billion. It also listed over 130 affiliate companies around the
world. Many affiliated companies joined in the bankruptcy filing in
Delaware on Friday. The FTX crisis brought a sudden turn of events
for Sam Bankman-Fried, who helped some crypto firms out of their
financial trouble earlier this year. Meanwhile, on Saturday, FTX
confirmed that there was an unauthorized access to its accounts a
few hours after the bankruptcy filing. Related Reading: XRP Price
Rallies 15%, Why Ripple Could Outperform Bitcoin and Ethereum The
news stirred reactions about whether the exchange got hacked or an
insider stole the funds. While the amount of money involved remains
to be determined, analytics firm Elliptic estimated that $477
million is missing from the exchange. Meanwhile, FTT has lost
97.19% of its valuation since the crisis and is now trading at
$1.804. Featured image from Pixabay, chart from TradingView.com
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