The Bear Market Is Pushing Bitcoin Exchange Giant, Huobi To Struggle For Survival
While 2018 hasn’t been a good year for cryptocurrencies in terms of its price points, cryptocurrency exchanges posted record profits with hundreds of millions of dollars in trading fees. However, the continued bear market is now eating into their profits.
Weng Xiaoqi, the chief executive of Huobi Global spoke in an interview with the South China Morning Post that bitcoin exchange giant might “struggle to survive” as the crypto winter continues.
“We do not know how long the bear market will last, so it is still possible that we will struggle to survive. We have to plan in advance and spend money carefully.”
— Dennis Parker?? (@Xentagz) October 29, 2018
Such a statement from Huobi, one of the oldest and largest cryptocurrency exchanges is quite telling about the current state of the market. Huobi, since its inception in 2013, has been ranked as the world’s highest-volume bitcoin exchanges at various times.
Weng adds that while Huobi is still making profits, but with trading volumes declining by 90 percent from their peak, bitcoin’s bear market is beginning to eat into the company’s margins.
The Laying Off
“Our greatest advantage over competitors is that we have licenses in all major countries – we are the only one among top global exchanges.”
Such troubles are not exclusive to Huobi, many cryptocurrency industry giants are suffering under the weight of the 13-month-long market decline. The suffers also include bitcoin mining giant Bitmain, the firm has reportedly planning to fire around 50% of its workforce. Several other companies in the past several weeks have shut down their operations.
In December, ConsenSys, an Ethereum development studio axed 13 percent of its employees despite a variety of ongoing projects based on the Ethereum network. Just a few days back, ShapeShift, a cryptocurrency brokerage service led by early bitcoin evangelist Erik Voorhees said goodbye to one- third of its workforce.
Until the market experience, a drastic upward shift, industry woes seem to be getting grimmer and bigger by the day.
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