HT, the native token of major Bitcoin and altcoin exchange Huobi, tumbled 93 percent on Thursday evening. After this drop, Justin Sun, the inventor of the TRON network and the famous name behind Huobi, made a statement. Various measures were taken to prevent such a situation from happening again. Here are the details…
Altcoin HT suddenly crashed
In the cryptocurrency world, sudden price fluctuations are not uncommon. However, the sudden collapse of Huobi Token (HT) in the evening has confused many. The Huobi Global exchange’s native cryptocurrency, based on the Ethereum Blockchain, has dropped an astonishing 90 percent in just 25 minutes. According to the data, HT dropped from a daily high of $4.81 to $0.31 at around 00:00 am Thursday through Friday. Other exchanges saw a similar decline.
This resulted in more than $200,000,000 of market value disappearing within an hour. However, the token quickly recovered over 1000 percent within minutes. The reason for the sudden price drop is still unclear, but some theories have been put forward. A tweet by a Kaiko researcher claimed that in the five minutes leading up to the collapse, $2 million in sales was reported, significantly higher than the usual $600,000 purchases in the HT-USDT pair. Some also claimed that the decline was due to broader negative market sentiment as the current market is in a downturn. At the time of writing, the coin is changing hands at $3.9, down 20 percent.
Justin Sun made a statement: $ 100 million liquidity fund was created
Justin Sun, founder of Tron Blockchain and a key owner of the token, commented that the sudden crash was caused by some users triggering a series of leveraged liquidations, which is a normal market behavior and volatility. Despite the volatility of the cryptocurrency market, HT remains one of the largest cryptocurrencies with a market cap of around $630 million after the recovery.
Currently, all work is proceeding steadily and there are no unexpected incidents, and these fluctuations are simply a result of market behavior.
— H.E. Justin Sun 孙宇晨 (@justinsuntron) March 10, 2023
Huobi now has a $100 million liquidity fund to guard against spikes in the HT token in response to what happened late Thursday, US time. Sun recently approved a $100 million USDC transfer to Huobi. “We will continue to improve the depth of liquidity of major cryptocurrencies and HT token, strengthen leverage risk alerts and liquidity capabilities,” Sun tweeted. Sun previously announced that he is a major investor in HT. As we reported on Kriptokoin.com, in October, Sun became an important person in the Huobi ecosystem. That month, HT had risen about 75 percent.
The token is used on the exchange to reduce trading commissions, purchase VIP status plans, vote on exchange decisions, and receive crypto rewards. As such, it is closely watched by crypto traders and investors. This sudden crash is a reminder of the risks involved in investing in cryptocurrencies, where sudden price fluctuations can occur within minutes. He also underlines the need for caution and research before investing in any cryptocurrency.
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