Huobi, one of the biggest cryptocurrency exchanges in the world, has announced that it is offering 30 million Huobi Tokens (HT) to fund the development of the Huobi Chain Project. Its ultimate goal is to move its entire operation onto a public blockchain, so that they become decentralized and autonomous.
Gordon Chen, a senior Huobi executive, says this will be the first experiment of its kind to transform a centralized corporation into a decentralized organization. Chen believes in the future, autonomous organizations will replace modern day corporations and he wants Huobi to lead this transition.
When the transition is complete, the traditional management structure will be replaced with code and community-based decision making. The system will automatically process transactions on the exchange, and anyone will be free to join the exchange without any centralized oversight of the registration process.
The HT will be distributed throughout an 8-phase contest that will take 21 months in which developers will compete to produce the best technology for Huobi Chain. Huobi will be establishing a committee of well-known leaders from open-source blockchain projects to oversee the contest and project.
The 30 million HT are worth over USD 150 million at this time, however, only 50 million HT are in circulation, while 450 million are held by Huobi. The 30 million HT will be taken from what Huobi is holding and dumped onto the market during the building of Huobi Chain, increasing circulating supply by 60%, which is expected to drive HT price downwards significantly. Since the announcement of the Huobi Chain bounty, HT price has declined by over 10% due to this expectation.
Huobi is a global cryptocurrency exchange with 5 million customers from over 130 countries and all-time trading volume near USD 1 trillion. On an average day, trading volume is in excess of USD 1 billion USD, ranking Huobi in the top 3 cryptocurrency exchanges in the world by volume, alongside Binance and OKEx.
Currently, Huobi is headquartered in Singapore, but was originally founded in China. Huobi was forced to halt all of its operations in China following a nationwide cryptocurrency trading ban in September 2017.
This is possibly a motive behind Huobi wanting to transform itself into a decentralized autonomous organization; once Huobi achieves its goal it won’t ever have to worry about running away from a nation’s government again. Huobi believes that by going completely digital and decentralized, and no government in the world will be able to disrupt its operations as in the past.
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