Huobi Token

What is Huobi Token (HT)?

Huobi Token is the native cryptocurrency token of the Huobi Global cryptocurrency exchange. Seychelles-based Huobi is one of the top cryptocurrency exchanges in the world, and one of Huobi Token’s primary functions is to reduce commissions for trading on the exchange.

Aside from these reductions in commissions, Huobi Token holders can vote on various exchange decisions, receive rewards for buybacks, and get early access to special events.

The Huobi Token was deployed on the Ethereum blockchain. It’s an ERC-20 standard fungible token, and you can track it on Etherscan, Ethereum’s blockchain explorer.

However, Huobi also runs its own public blockchain called the Huobi Eco chain, or simply HECO. This Ethereum-compatible blockchain uses HT as a native token. It also requires transaction fees to be paid in HT and miners to pledge HT to become validator nodes.

When Was Huobi Token Launched?

The Huobi Token was issued on Ethereum in 2018 and distributed to Huobi users according to a special giveaway plan. With a total of 500 million HT issued, 300 million were distributed to Huobi platform users, and 100 million were earmarked for platform rewards and operations. The final 100 million were reserved for team incentives.

Following the giveaway, Huobi users could trade the HT token on the Huobi platform and avail themselves of the token’s benefits right away.

Who are the Founders of Huobi Token?

The Huobi Token was launched by the Huobi Global cryptocurrency exchange, the brainchild of Leon Li. Formerly a computer engineer at Oracle and a graduate of Tsinghua University, Li founded Huobi in 2013.

Alongside Li at Huobi’s founding was Jun Du, a serial entrepreneur. Previously of Comsenz and Tencent, Du has founded several companies, including Jinse (a blockchain service platform), AToken, and Chainup. Du is also the CEO of Node Capital, a venture capital firm specializing in blockchain and cryptocurrency.

How Does Huobi Token Work?

The Huobi Token is the native token of the Huobi ECO chain, where it is staked by proof-of-stake validators. These validate blocks that are generated by the network’s miners.

However, the Huobi Token was first deployed on Ethereum and can coexist on both platforms. This is because HECO is compatible with the Ethereum Virtual Machine (EVM).

HT is an ERC-20 token, which is a token standard on Ethereum proposed in 2015. ERC-20 makes tokens fungible and allows the transfer of tokens between accounts, the retrieval of balances and supply, and the approval of third-party spending from accounts.

ERC-20 tokens are smart contract-compatible. In fact, many of the best-known cryptocurrencies, such as Shiba Inu, USDC, Chainlink, and Uniswap, are ERC-20 tokens.

What Makes Huobi Token Unique?

The Huobi token was launched shortly after the Binance coin (BNB). It’s one of many exchange tokens in the market, such as FTT, OKB, and KCS.

Many of these exchange tokens work much like HT does, although the Huobi Token arguably has more utility than many since it powers the Huobi ECO chain.

On the other hand, many other exchange tokens are subject to regular burning schedules. They allow holders to use them on incubation platforms to generate new tokens and avail users of trading fee discounts.

However, HT does carry out a monthly burn, compared to Binance and KuCoin, which burn their tokens quarterly.

What really sets most of these tokens apart from each other is the platform and ecosystem that they empower. HT backs the Huobi ecosystem, which is powerful for its global reach. The Huobi Global cryptocurrency exchange is often considered a “Tier 1” exchange.

How is the Huobi Token Network Secured?

Huobi has its own blockchain, but HT is primarily an Ethereum token. This means Huobi Token relies on the Ethereum blockchain for its security, which Ethereum’s Ethash algorithm and vast network of miners amply provide.

Ethereum’s 2.0 transition will shift ETH to proof-of-stake (PoS), leaving behind the more energy-intensive proof-of-work consensus mechanism currently being used.

PoW Ethereum is more energy intensive because it relies on nodes called miners to provide computational power to the network. This means that mining companies run entire farms of GPU ‘rigs’ guzzling energy.

PoS will shift consensus to an economic model, where validators will still be rewarded but need to lock tokens in the protocol to do so. Misbehavior sees these tokens confiscated or outright destroyed in a process called slashing.

The Huobi ECO chain also plays a part in the Huobi Token’s security since it uses HT as a native token. HECO is a hybrid proof-of-stake (HPoS) blockchain that uses proof-of-work miners to generate new blocks but lets 21 PoS validators validate them.

What is the Use of HT?

Holding Huobi Tokens in the Huobi exchange wallet allows users to benefit from up to 65% in trading fee discounts. That makes this wallet a beneficial asset that can help users trade more efficiently.

Furthermore, HT lets users access new crypto projects and earn tokens from them via Huobi Prime. This platform allows HT holders to purchase newly launched tokens at a discount prior to exchange listing, a service that was previously limited to exclusive investor groups.

Huobi’s PrimePool also provides users with a form of passive income. When HT holders stake HT to the PrimePool for a certain amount of time, they are airdropped certain quantities of the new token proportional to the amount of HT locked.

Huobi Token holders can also stake HT to the Huobi ECO chain. The HECO chain features decentralized applications that have mining and staking functions. That being said, HT holders can stake Huobi Tokens to the HECO chain on the network itself or the Huobi Exchange.

Finally, the Huobi Token includes a measure of governance, allowing holders to vote on issues like future coin listings. Unlike many other platforms, Huobi has put bigger issues to a vote, such as changing their token burn from a quarterly to a monthly schedule.

Who Controls Huobi Token?

The Huobi Token is controlled by the Huobi Global cryptocurrency exchange, which was founded in 2013 by Leon Li and Jun Du.

Huobi provides Internet of Value (IoV) services to tens of millions of users in over 100 countries. It is licensed for digital asset services in many countries and regulated in countries like Japan, South Korea, and Gibraltar.

Founder Leon Li holds a majority stake in Huobi. Yet, in August 2022, Bloomberg reported that Li had been exploring options to sell his stake. Reportedly, Li had valued his approximately 60% stake at over $1 billion, giving Huobi a valuation of $2–3 billion.

According to the Bloomberg report, TRON founder Justin Sun and Sam Bankman-Fried’s FTX cryptocurrency exchange were among the parties interested in the deal. Huobi confirmed that Li was negotiating with potential investors, but he didn’t give further details.

However, many considerations related to the Huobi Token are voted on by token holders, giving the token’s governance an element of decentralization.

How Much Is HT In Circulation?

500 million HT were issued at genesis, but that number has since been reduced thanks to the implementation of a burning schedule.

While not unique among exchange tokens, Huobi carries out monthly token burns by buying back Huobi Tokens from the market and destroying them.

Huobi allocates 20% of its monthly revenues to repurchasing HT. 15% goes toward burning HT from the circulating supply, and 5% goes toward burn HT team incentive rewards. According to Huobi, this reduction in token supply keeps inflation low and helps to support the price of the token in the market.

How Do You Buy HT?

As an ERC-20 token, the Huobi Token is easy to acquire. Ethereum has a vast ecosystem of decentralized finance applications. This means you can use decentralized exchanges like Uniswap to buy HT at any time.

However, HT is the native token of Huobi Global, and that’s certainly one of the best places to buy it.

While you can also purchase it on many competitors’ platforms, buying and holding HT on Huobi Global brings many benefits. These include taking advantage of fee discounts, staking, or token generation via Huobi PrimePool.

Huobi Token also has a capacity, limited though it may be, for governance utility. This means that HT holders often vote on various things that can impact platform health, stability, and performance.

It’s true that most entities in the blockchain industry do prioritize overall growth. Still, remember that storing HT on a competing platform will grant them greater voting power when it comes to Huobi governance matters.

Coins on an exchange, after all, belong to the exchange—not to you. As the saying goes, “not your keys, not your coins.”

Is It Possible to Buy Huobi Token Instantly?

The speed of transaction when buying Huobi Tokens depends on the platform you’re using. Exchange purchases are usually instant. This is because, as mentioned previously, they belong to the exchange and often don’t even engage the blockchain.

However, buying HT on decentralized exchanges or DeFi platforms does put your transactions on the blockchain. That means that transaction speed will depend on the performance of the blockchain and any congestion at the time.

The Huobi ECO chain is fast, with a block speed of just a few seconds. Still, base layer Ethereum transactions may take a few minutes to finalize.

How Do You Store HT?

Since HT is a cryptocurrency, you can store it in different types of wallets, including:

• Cold Wallets. Referring to “cold storage,” these wallets keep private keys offline and out of the reach of hackers. These can come in several forms—from devices not connected to the internet to a paper copy of the private key.
• Hot Wallets. Unlike cold wallets, these are connected to the internet. They can come in the form of full clients that download a copy of the blockchain or light clients that interact with full nodes. They can even be online or web wallets that store credentials with the online wallet provider rather than the user’s hardware.
• Exchange Wallets: When sending cryptocurrency to an exchange account, there may be some identification system or memo in place to ensure that the funds reach the correct user account. Exchange accounts are also custodial, which means that the actual tokens are stored in an address controlled by the exchange—not the account holder. The account holder simply has an entitlement to some of the crypto in the exchange’s wallet.

The Huobi Global exchange is, however, a good place to store Huobi Tokens. Much of HT’s utility is tied to the exchange, including trading fee discounts and PrimePool usage.

Huobi Token Energy Consumption

You can look at the energy consumption of the Huobi Token in two ways. On the one hand, ERC-20 Huobi Tokens on Ethereum aren’t really responsible for too much energy consumption. Their presence is a drop in the water compared to the massive number of tokens and transactions on Ethereum.

On the other hand, the Huobi ECO chain does use HT as its native currency, and the power draw of this blockchain can be attributed to the HT coin.

HECO incorporates elements of proof-of-work into its architecture, relying on miners that make PoW computations to generate blocks. This is accepted as a more energy-hungry form of block creation since these miners are computers hard at work solving complex puzzles.

As such, if HT mining were to become extremely prevalent, its power requirements would also likely increase. Having said this, the use of PoS validators does mitigate this energy requirement to some extent.

Is HT a Good Investment?

Many consider HT an attractive token thanks to its distribution to Huobi platform users. The HT token has an ever-shrinking supply thanks to monthly burns, and growing utility on the platform are also favorable features.

The argument of HT being a store of value is very much enhanced by its increasing scarcity. However, this dynamic is not necessarily permanent and may change at the discretion of token holders in future elections.

There is further potential for increased utility if the Huobi Global exchange can continue to add value and create use cases for their native token. Huobi continues to add to its portfolio, operating the likes of Huobi US, Huobi Japan, and Huobi China, as well as tools like Quick Wallet.

However, risks related to centralized exchanges always remain. They can be connected to malicious attacks, regulatory interference, and other factors that include poor performance or business decisions.

Nevertheless, Huobi Global remains one of the top-rated and most active cryptocurrency exchanges today. And if it can continue on an upward trajectory, then all signs point to the Huobi Token doing the same.