When crypto exchange Huobi began their operations in Brazil in May 2018, crypto enthusiasts thought that it would give a tough competition to the local exchanges. Some of them even thought that by providing users lower fees, greater liquidity and larger coin selection, Huobi would threaten local exchanges. However, the recent round of layoffs suggested that the exchange is not likely to be a dominant force in Brazil.
When Huobi reportedly expanded its operations in Brazil in May, the exchange began marketing its platform in the country. It also started hiring regional staff after setting up a workspace in São Paulo. As part of its marketing initiative, Huobi representatives were seen handing out business cards at a cryptocurrency conference, VI Bitconf, held in São Paulo.
Crypto exchange Huobi also reached out to well-known names in the Brazilian market and put up ads on LinkedIn looking for a Chief Compliance Officer and a Digital Marketing Manager to work out of São Paulo. Before China placed an all-out ban on cryptocurrency trading in September 2017, Huobi was one of the largest Bitcoin exchanges in the country. Instead of pulling down its shutters due to the ban, Huobi began a major expansion effort. The exchange set up offices in South Korea, Singapore and elsewhere, as reported on Bitcoin Magazine.
Brazil with a population of 210 million is home to half the population of South America. It presented a huge potential market for Huobi. With the competition in Brazil being relatively sparse, Huobi was expected to give tough challenge to some of the biggest crypto exchanges in the country such as BitcoinTrade, Foxbit and Mercado Bitcoin. All these local exchanges trade relatively smaller volumes as compared to Huobi.
It was also believed that besides the existing crypto exchanges in Brazil, Huobi would be competing with XP Investimentos, the country’s biggest investment firm, which was also set to launch a cryptocurrency exchange, as reported on CCN.
Crypto exchange Huobi’s CEO, Frank Tao of Brazilian operations confirmed the recent layoffs. He, however, did not comment on how many employees were laid off. Last month, one of the larger Brazilian Bitcoin exchanges, Mercado Bitcoin also laid off 20 employees. It may be possible that Huobi is cutting down its Brazil operations owing to financial issues, as the bear market extends its reaching into 2018. Another probable reason may be that Huobi faced issues with the country’s regulation, as reported on CryptoGlobe. Whatever be the reason, this recent lay off decision may not position Huobi as the dominant force in Brazil as it was expected.[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]