According to a new filing with the Hong Kong Stock Exchange on Monday, November 11, 2022, investment holding company New Huo Technology, formerly known as Huobi Global, said it has $18.1 million worth of funds trapped on the Hong Kong exchange. cryptocurrencies in distress, FTX. Of this amount, USD 13.2 million consist of customer deposits, and USD 4.9 million comprise assets belonging to Hbit, another subsidiary.
New Huo Technology is majority owned by Chinese entrepreneur Lin Li, who also created Huobi Global, the world’s 20th largest exchange by trade volume. On November 13, the company disclosed that it had reached an agreement with Li for an unsecured, interest-free credit line of up to $14 million to cover customer obligations. However, the company wrote:
“However, the Board anticipates that the group’s financial results could be materially and adversely affected if the incident is not resolved. The board of directors will discuss with the group auditor the impact of the incident on the financial position of the business”.
The news appears to have rattled investors on Twitter after initial confusion surrounding the company’s former name, Huobi Global. In connection with this matter, the exchange issued the following clarification:
“On October 8, Huobi’s majority shareholder company transferred all Huobi Global shares it owns to the About Capital fund. New Huo Tech are independent entities. All Huobi operations are normal, and we will continue to provide customers with secure services and reliable”.
The news also comes at a time of widespread panic over exchange solvency issues following the FTX collapse. Cointelegraph previously reported on Nov. 13 that both Huobi and Gate.io came under fire for allegedly sharing proof of reserves using borrowed funds.
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