Authorities Probe Ex-Huobi Global Manager for Illegal Trading
- Huobi Global has had a $1.34 billion trading volume over the last 24 hours.
- Huobi is currently the world’s fourth-largest exchange platform.
- The trading firm was ousted from China following a raid on the crypto space by the Chinese government.
Insider trading and other forms of vice are becoming increasingly popular in the crypto space. One of the most recent cases involves Chen Boliang, a former senior manager at the crypto exchange firm, Huobi Global. Boliang worked at the company’s institutional clients department but had his employment terminated in 2020, according to a statement from the Seychelles-based exchange.
Hong Kong authorities are presently prosecuting the former manager on charges that he made $5 million in illegal profits by covertly trading against the firm. The said trades were reportedly executed in February and March 2020. Boliang was later detained in May 2020 on grounds of breaking into Huobi’s internal systems with illegal intentions.
Huobi Global released a statement with regards to Boliang’s prosecution.
“Mr. Boliang Chen’s employment with Huobi Global was terminated in May 2020. We have no further comments about the charges against Mr. Boliang Chen and believe in the administration of justice by the HK Special Administrative Region.”
Boliang Created a Retail Trading Account
Details from a lawsuit filed by the trading platform revealed that the former manager committed fraud by using his father’s name to open a retail account. Boliang then used his position to authorize a $20 million credit line from the company.
According to reports, Boliang continued the illegal operation by trading against a corporate account he managed, earning a profit of nearly $5 million in the form of popular crypto stablecoin, USDT.
The disgraced former Huobi staff is presently released on a $25,000 bail but has a mountain of legal cases set before him. Boliang faces one count related to crime proceeds and six counts for accessing Huobi’s systems. The Hong Kong magistrate will conduct a preliminary investigation into the matter next week to determine whether there is sufficient evidence to proceed to trial.
Insider Trading Triggers Calls for Regulation
Boliang’s story is one of the many rising cases of insider trading facing the crypto industry. The growing popularity of these illegal schemes has led the U.S. Securities and Exchange Commission (SEC) to begin investigations on many top exchanges. The SEC is said to investigate the measures set by these trading firms against insider trading.
There have been growing calls for regulation within the crypto space as cases of rug pulls and liquidation cast doubt on the industry. The collapse of Terra’s UST and LUNA which erased about $40 billion of investors’ money further triggered concerns from authorities over the market. Many experts believe the crypto space could face regulation as early as this year.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
