- Huobi Global Limited is expanding to Hong Kong.
- Founder Li Lin has sued the exchange in Hong Kong.
- The founder has made many allegations against the exchange, which could hinder the exchange’s move to the territory.
Huobi remains one of the top exchanges in the world. However, the firm has been rumored to be in a crisis since the start of the year, given its dwindling trading volumes. This downturn has drawn increased scrutiny toward the exchange and its operations.
Amid mounting pressure, the exchange plans to expand its services to Hong Kong. However, to complicate matters further, Huobi founder Li Lin is now looking to sue the exchange in the territory.
Huobi Suing Huobi?
Huobi Founder Li Lin is suing Huobi Global by filing a lawsuit in the Hong Kong High Court, according to crypto reporter Colin Wu. The lawsuit alleges that the exchange used the “Huobi” trademark without consent from X-Spot, Li Lin’s company that holds exclusive rights to the brand.
The court filing reveals that Li Lin sold his stake in the exchange to Justin Sun’s investment firm, About Capital Management. However, the ownership transfer agreement stipulated that the original shareholders would retain rights to the company’s trademark, which would not be transferred to the buyers.
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Despite these terms, Huobi allegedly went against the agreement and reused the trademark, increasing tension between the two parties. To intensify the conflict further, Justin Sun blocked Lin’s brother’s account, further driving a wedge in their strained relationship.
Interestingly this is not the first time there has been conflict between the two parties.
Not Huobi’s First Rodeo
Huobi Global is often at odds with its previous owners, and recent development has further fueled tensions. According to Wu’s report, Justin Sun justified blocking Lin’s brother by alleging that he dumped the firm’s native HT tokens, which he reportedly got for free. Additionally, Sun claimed that Lin’s brother sold the tokens for a substantial amount while not contributing to the HT community.
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In response to these allegations, Huobi Global Limited defended its positions, asserting that it possesses the legal rights to use the trademark in many legal jurisdictions worldwide. This allows the exchange to use the trademark as it sees fit. At press time, HT was exchanging hands at $2.70, marking a 3.7% increase over the past 24 hours and boasting a $438 million market cap.
Despite the ongoing dispute, Huobi Global continues to operate and lead the cryptocurrency market.
On the Flipside
- Huobi Global Limited is not registered in Hong Kong. However, it has launched trading services under the Huobi HK brand in the country.
- Huobi Global Advisor Justin Sun is reportedly looking to sell his majority stake in the firm.
Why This Matters
The case could hinder Huobi Global Limited’s expansion to Hong Kong and spread uncertainty. Justin Sun has shared that he plans to move the exchange’s Asia Headquarters from Singapore to Hong Kong; however, the way this case unfolds could impede the exchange’s Hong Kong expansion.
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