A major Chinese crypt exchange, Huobi, is studying the possibility of taking over Bitflyer, a Japanese competitor, and Bithumb, a Korean platform.
One of the largest Chinese cryptographic exchanges, Huobi, is trying to buy two cryptographic trading platforms at once: Bitflyer and Bithumb. Colin Wu, a Chinese blockbuster correspondent, announced this on his Twitter page. According to Wu, Bitflyer is preliminary estimated at $500 million.
Meanwhile, Wu notes that in case of Bitflyer’s takeover, both exchanges could be blocked because Huobi is “under investigation by the Chinese government. Earlier Wu said that a top manager of Huobi was in the middle of an investigation, but later the official Twitter feed of the crypt currency exchange called these “false”.
However, Bithumb is not doing any better in the local market. At the beginning of September 2020, the exchange found itself in the middle of a scandal involving more than $20 million in fraud due to a listing of a cryptographic asset.
In November 2019, Huobi announced its withdrawal Bitcoin Revolution from the US market. Since then, the company has had two key areas for expansion left: Japan and South Korea. Wu believes that Huobi is seen as a serious threat by the Chinese authorities and is therefore in a hurry to take over foreign companies:
“Huobi is aware of the risks associated with its dependence on the Chinese market, and is therefore expanding into foreign markets with great urgency. However, Japan and South Korea are not the best targets for investment. Their users are very closed, and the government strictly regulates [the industry].
As Wu notes, both exchange transactions have had to be frozen due to a “surprise investigation” into Huobi. The founder of Huobi has been banned from leaving China since 2017, stresses Wu.
China is actively preparing for the release of the digital yuan and has been pursuing major local players over the past few months. For example, in October, Chinese authorities arrested Star Xu, the founder of OKEx. It is still unclear what Xu’s case is.
Despite the pressure on the local crypto industry, the Celestial Empire continues to invest in the development of the Decentralised Financial Market (DeFi). According to James Jillingham, co-founder of liquidity aggregator Finxflo, the Chinese authorities are “cooperating” with Huobi, resulting in the exchange creating its own DeFi network.
“Thanks to Shanghai College, they received full support. They actually support this [DeFi development] through Huobi,” added Jillingham.