Huobi Founder Sells 100% Stake to Justin Sun Fund: Report
Huobi founder Leon Li will no longer be part of the business’ operations after the deal closes, with Justin Sun taking on an advisory role
Justin Sun, founder of TRON and CEO of BitTorrent
key takeaways
- Tron founder Justin Sun is reportedly the core investor of About Capital, which just bought Huobi
- Huobi founder Leon Li had been shopping his stake for more than a year
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 statement 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 Messari ranking the exchange eighth by total volume having processed nearly $111 million in trades over the past 24 hours.
China-based journalist Colin Wu reported 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).
The controversial crypto entrepreneur told Wu that he didn’t participate and later reiterated his denial to The Block. Still, he’s now officially one of Huobi’s global advisors, 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.
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 Korean website. But its regional affiliates appear to have bases in different locations, with Singapore serving as the firm’s Asian headquarters.
Huobi says it’s seeking a new base in Europe, after moving its spot trading operations to a subsidiary registered in Gibraltar last November. A Huobi spokesperson wasn’t immediately available to comment on the matter.
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’t Sun’s first foray into crypto exchanges. As part of a different investment group, Sun previously acquired crypto exchange Poloniex in 2019 from stablecoin issuer Circle. He initially denied the buyout.
Huobi founder shopped stake long before Justin Sun’s reported buyout
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.
The company gradually exited 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 reported.
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 “Trust Score” rankings 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 sell 60% of his stake, aiming for a company valuation of between $2 billion to $3 billion.
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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