By
Mayowa Adebajo
April 11th, 2024
The rumors about FTX potentially buying Huobi are not a surprise, considering FTX race in acquiring spree, even during the crypto winter. This year so far, FTX already signed a few acquisition deals.
Earlier this month, we reported stating that founder and CEO of Huobi Global Ltd Leon Li was in talks with investors to sell his majority stake in the company (60% of Huobi shares). Li was aiming for a valuation of $2 billion to $3 billion which placed the stake sale at a minimum of $1 billion. Notably, FTX Exchange CEO Sam Bankman-Fried was among those interested. As a result, there have been rumors about FTX considering buying Huobi.
Besides, on Monday, a user with more than 500,000 followers on social media Weibo, Chinese Twitter-like platform, said that FTX had already acquired Huobi, and Huobi would be renamed as HTX.
However, yesterday, to deny all the allegations, Sam Bankman-Fried said on his Twitter that FXT has no intention to acquire Huobi.
Just to be explicit because apparently a lot of people are saying this:
No, we are not planning to acquire Huobi.
— SBF (@SBF_FTX) August 29, 2022
It remains unclear if FTX is planning to somehow invest in Huobi, considering the recent negotiations between the CEOs. Notably, those familiar with the matter said that Tron founder Justin Sun was also among the investors who held preliminary talks with the Huobi founder.
Huobi said:
“He [Li] hopes that the new shareholders will be more powerful and resourceful, and that they will value the Huobi brand and invest more capital and energy to drive the growth of Huobi.”
The decision to sell a major stake in the company comes as a result of a sharp drop in revenue following the removal of all Chinese users. Last year, Houbi moved its headquarters to Seychelles amid the crackdown on crypto in China.
FTX Acquisitions
The rumors about FTX potentially buying Huobi are not a surprise, considering FTX race in acquiring spree, even during the crypto winter. This year so far, FTX already signed a few acquisition deals.
In April, FTX acquired Japanese exchange Liquid and its operating subsidiaries to serve its Japanese customers and offered the company a loan of $120 million.
Further, FTX entered an agreement to acquire the Canadian crypto asset trading platform Bitvo. The acquisition is expected to close in the third quarter of this year, subject to regulatory approval and customary closing conditions.
In addition, FTX pegged a $240 million deal to buy troubled BlockFi if the lender is able to get a key SEC approval and double its client assets. If by the end of 2022, BlockFi is able to get an important regulatory clearance from the US Securities and Exchange Commission (SEC) for its BlockFi Yield product, then FTX will pay an extra $25 million.
Earlier, FTX also offered to purchase Voyager Digital company with cash and offered early liquidity on customers’ bankruptcy claims. However, its bid was the lowest one, and Voyager declined the offer, calling it a “low-ball bid dressed up as a white knight rescue” that only benefits FTX.