According to a Financial Times report, a former senior manager in Huobi’s institutional client’s department, Chen Boliang, made $5 million trading against a company account. The accused is being prosecuted in Hong Kong.
Although the trades happened in Feb and Mar 2020, FT says that the case was not previously reported. Boliang who was a former senior manager at one of the largest crypto exchanges, Huobi Global, secretly traded against another account that he controlled.
Huobi was registered in China in 2013 but with the country’s stance on digital assets in 2021, the exchange had to move and is now registered in Seychelles.
While according to Hong Kong’s law that there should be enough evidence for such inquiries to go to trial, Boliang’s case is scheduled for a “preliminary inquiry” next week. The evidence shows that the 34-year-old has accessed the company’s computer systems and collected $5 million worth of the largest stablecoin, Tether (USDT).
Furthermore, Boliang created a retail account in the name of his father while giving it $20 million worth of Huobi’s credit, FT says. The report says that he then traded against a corporate account that was under his control too.
Boliang got a $25,000 bail and will face “six counts” for misusing Huobi’s computer systems and “one count” for the $5 million proceeds. His attorney, Lareina Chen, did not respond to FT’s request for comment.
“Mr Boliang Chen’s employment with Huobi Global was terminated in May 2020. We have no further comments pertaining to the charges against Mr Boliang Chen and believe in the administration of justice by the HK Special Administrative Region,” Huobi Global said.
According to a Wall Street Journal report in May, insider trading has risen significantly with the global rise of cryptocurrencies. The study based on public data shows that employees of some of the largest crypto platforms, including Binance, Coinbase, and FTX, have been using the firm’s classified data to get huge profits.
Moreover, some insider traders have made over $1.7 million, according to the report.
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