Huobi founder Leon Li in talks to sell his shares for up to $3B

Cryp­to exchange giant Huobi’s founder and CEO Leon Li is in talks with investors to sell his major­i­ty stake for $2 bil­lion to $3 billion.

Accord­ing to a Bloomberg News report, Tron founder Justin Sun and FTX founder Sam Bankman-Fried (SBF) are among the inter­est­ed parties.

Li holds near­ly 60% of Huo­bi Global’s shares. If Li man­ages to sell them for $3 bil­lion, it’ll mark the largest takeover in the mar­ket since the mar­ket cap fell below $1 trillion.

A spokesper­son from Huo­bi con­firmed Li’s deci­sion and said:

“[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,”

So far, spokes­peo­ple from FTX declined to com­ment, and Sun said he didn’t have any nego­ti­a­tions with Li regard­ing the sale.

Huobi Global

Li launched Huo­bi glob­al in 2013, and the com­pa­ny became one of the largest cryp­to exchanges. How­ev­er, it lost momen­tum when it shut down oper­a­tions in Chi­na in Novem­ber 2021. The deci­sion came after the Chi­nese gov­ern­ment deemed cryp­to trans­ac­tions ille­gal. The deci­sion hit Huo­bi hard­er than any oth­er exchange, as Chi­na was Huobi’s pri­ma­ry market.

The exchange has expand­ed over­seas to coun­tries like Turkey and Brazil and is cur­rent­ly con­sid­er­ing expan­sion by obtain­ing a Fin­Cen license. How­ev­er, giants like Binance and FTX appear to be Huobi’s com­peti­tors in those regions.

Li’s deci­sion to sell his shares was leaked in July 2022 but wasn’t con­firmed. At the time, Huo­bi was also expect­ed to down­size and lay off around 30% of its staff — rough­ly 300 peo­ple. The exchange said that the bear­ish mar­ket con­di­tions posed a finan­cial chal­lenge and that the com­pa­ny would cut costs, includ­ing layoffs.

Emergence of M&A

FTX has been bull­ish on Merg­ers & Acqui­si­tions since the begin­ning of the bear mar­ket. At the end of May, FTX U.S. pres­i­dent Brett Har­ri­son said that FTX was look­ing to spread world­wide by acquir­ing com­pa­nies with the nec­es­sary region­al licens­es. He said:

“We’re doing that glob­al­ly, in places like in Japan, Aus­tralia, in Dubai, dif­fer­ent places where we’ve been able to either part­ner with local com­pa­nies or some­times do acqui­si­tions to be able to get licens­es that we need,”

On the oth­er hand, SBF was sure that many cryp­to exchanges and min­ing com­pa­nies would fail in the cur­rent win­ter mar­ket. SBF said that he saw this as an oppor­tu­ni­ty to pur­chase com­pa­nies that need a sav­ing hand.

Fol­low­ing his words, FTX approached Bithumb, Block­Fi, and Voy­ager Dig­i­tal to pur­chase their organizations.