Key Takeaways
- Â Hbit has sold $19.5 million worth of creditor claims to Ceratosaurus Investors LLC
- The deal implies a recovery ratio of 108% of the firm’s assets.
Sinohope, formerly Huobi Technology, created by Huobi exchange co-founder Leon Li, will recover over 100% of its stuck deposits on the defunct crypto exchange FTX via its Hbit subsidiary.
As per a May 24 announcement, Hbit has sold $19.5 million worth of creditor claims to debt investment firm Ceratosaurus Investors LLC. Sinohope Technology Holdings Limited has announced the sale of all rights, title, and interest in its FTX Claim to an independent third-party buyer for $19.5 million USD. When FTX imploded and collapsed in November 2022, Sinohope had approximately $18.1 million worth of deposits stuck on it. The deal implies a recovery ratio of 108% of the firm’s assets.
Sinohope was materially impacted by the unreturned funds. On December 13, 2023, the firm disclosed that it expects a loss of $280 million Hong Kong dollars ($35.86 million) for the first nine months of the year, an increase from $200 million Hong Kong dollars ($25.61 million) it lost during the same period in 2022.
Part of the loss included $86 million Hong Kong dollars ($11 million) of enterprise deposits immobilized on the bankrupt cryptocurrency exchange FTX. To keep the firm alive, Leon Li had to personally extend a $14 million personal line of credit to bail out Sinohope customers affected by FTX’s collapse.
On December 11, 2023, X-Spot Global, another company owned by Leon Li, won an injunction against Huobi Global, requiring the latter to cease using the Chinese-equivalent “Huobi” trademark in Hong Kong.
According to court filings, the Huobi trademark was registered in 2019 in Hong Kong. In September 2022, co-founders Leon Li and Du Jun sold Huobi Global to About Capital Management, an entity linked to Chinese blockchain personality Justin Sun. However, prior to the acquisition, the rights to the Chinese-language Huobi trademark had been fully transferred to Leon Li’s X-Spot Global, making the entity its trademark owner. Huobi subsequently rebranded to HTX last September.
New Huo Technology is majority-owned by Chinese businessman Lin Li, who also created Huobi Global, one of the largest crypto exchanges worldwide by trading volume. On November 13, 2022, the company disclosed that it had reached an agreement with Li for an unsecured, non-interest-bearing credit facility up to a maximum of $14 million to cover customers’ liabilities.
Sinohope is controlled by Li Lin, who founded the crypto exchange Huobi, now known as HTX. In October 2022, Li sold his entire stake in the exchange to the Hong Kong fund About Capital Management.
