Huobi May Attempt a Reverse IPO Per Letter Posted with Hong Kong Stock Exchange
Huobi, one of the largest crypto exchanges in Asia, seems to be moving towards a reverse Initial Public Offering (IPO), some documents posted on the Hong Kong Stock Exchange (HKEX) suggest. According to the latest filing, the company will use a company that was recently purchased to make the move.
Pantronics Holdings Limited was acquired recently by Huobi and will have its name changed to Huobi Technology Holdings Limited. The process is known as a “reverse takeover” and would lead Huobi to turn the other company, which was already listed, in Huobi as well, meaning that the company would go public via this controversial route.
Over $221 million USD was invested to get 73% of the company's shares to make this happens, which shows how serious Huobi is about this project.
Unfortunately for the crypto company, there may be another obstacle in the way now. The exchange is planning to launch new rules regarding backdoor IPOs next month and they could affect Huobi’s move.
According to the new regulation, it may become harder for companies to do this, as they will have to follow other rules to be properly accepted as public companies.
In fact, it is not easy to go public in Hong Kong. Several other crypto companies have already tried, too, and most of them have met failure.
Bitmain, for instance, was a very wealthy company that was not accepted. The company is now trying to be accepted in the Western market by filing to go public in the U. S. Canaan Creative, another mining company, was also reported to file to go public in the largest economy of the world after it was also rejected in Hong Kong.