Huobi, a cryptocurrency exchange in China is going up against one of their competitors, OKEx. They have specifically aimed at the business of trading Bitcoin futures and other derivatives contracts. This fight is just another avenue that has opened up in a longstanding rivalry between the two. Based in Malta and led by Chinese executives, OKEx is the biggest crypto derivatives exchange in the world. According to the data, they have outstanding contracts that are valued at $12.6 billion. Also led by Chinese executives, Huobi is based in Singapore and is running close behind OKEx. It has tied for the second spot at $1.25 billion with another crypto exchange BitMEX.
This month, Huobi said in a report that when it comes to futures trading volume, it has successfully pushed new boundaries against other renowned exchanges. The report said that Huobi was already edging ahead of OKEx in a couple of market segments, which include ‘coin-margined futures’ where traders can use cryptocurrencies for posting their initial down payment, referred to as margin. Huobi has also claimed that they are regularly beating OKEx in bitcoin futures contracts, both weekly and quarterly. Vice president of Huobi Global Markets, Ciara Sun said that Okex had had the largest share of the futures trading world before they had introduced their futures contract in December 2018.
This battle for supremacy between the two exchanges in regard to crypto futures and China has only increased tension. Since 2018, these exchanges have been at loggerheads with each other, when the then-CEO at OKEx, Chris Lee, had defected to Huobi to take the position of vice president of global business development. In March, in a company update, Jay Hao, CEO at OKEx referred to Huobi as their ‘doppelgänger’ and also said that imitation was the sincerest form of flattery. Last week, he had said that OKEx didn’t compare their performance with its peers because it wasn’t possible to define the competition with certain metrics or data.
As per experts on China’s crypto market, the competition between the two exchanges mostly stems from the battle for more customers in the second-largest economy in the world. The experts have said that there is a natural friction between Huobi and OKEx. Even though both crypto exchanges have made an effort to push their international footprints as far as possible, they have still kept their attention focused on their Chinese user base. China has been driving towards becoming the leader in the blockchain industry and some observers are of the opinion that it is because of their cold war with the United States for achieving technological supremacy.
A digital version of the Chinese currency, the yuan, is already being tested by Chinese banks whereas American officials have said that they are only studying the possibility of a digital dollar. As per the current rules, it is not possible for Chinese exchanges to sell crypto for yuan, but a lot of people in the country do purchase dollar-linked stablecoins, such as tether (USDT) and Bitcoin (BTC) from over-the-counter brokers and then use them for trading purposes.