Leading crypto exchange Huobi Global has released a new order to restrict employees from trading with in-house data and bans using non-company accounts to engage in secondary market transactions.
Huobi Global tackles employees’ insider trading
China-based crypto exchange Huobi Global has issued new crypto regulations to restrict “insider trading,” a form of illegal trading that entails trading a publicly-traded company’s securities while possessing material information that is not yet public information. As reported by Chinese crypto analyst, WuBlockchain, Huobi is launching its new rule to prevent its employees from trading with privileged information.
Earlier today, WuBlockchain tweeted, “Huobi Issued employee investment behavior management regulations to prevent insider trading, requiring all employees not to use internal information to trade for HT, HPT, TRON tokens, etc. Exclusive”
In a recent statement shared by WuBlockchain, Huobi stated that all its employees are not allowed to use internal information to conduct “rat warehouse operations” for related self-operated currencies such as HT, HPT, TRON tokens, and others. Although Huobi permits its employees to make various investments, such as private placement and public offerings in the primary market, they cannot make improper promises with their position rights to obtain investment shares.
“Employees of transaction-related departments are not allowed to use non-company accounts in the exchange to engage in secondary market transactions (except for the top 20 currencies by market value and HT and other platform self-operated currencies),” the Chinese platform wrote.
Huobi’s in-house crypto regulations
Following the FTX haze, the crypto community has witnessed several attempts at crypto regulations. However, Huobi’s move marks the first call for regulation from within a crypto exchange directed at employees in crypto exchanges. Considering the recent rumors of insider works in major wallet drains and price crashes, the crypto community has agreed that Huobi’s new development is a welcome move.
Last month, concerns of a likely crypto insider trading emerged after an unknown wallet address purchased 2,029,846 OSMO tokens barely 24 hours before Binance’s announcement to list the asset. There have also been rumors of insider works in the FTX crash.
To prevent all forms of insider trading, employees working in departments related to new asset launches are now required to actively disclose the holdings of the assets to the audit department. Also, the employees who hold the assets shall not participate in the evaluation, business negotiation, operation, and other links of the assets. Huobi also wrote,
“The audit department will inspect employees’ investment and transactions from time to time. If the above violations are found, they will be dealt with in accordance with the Huobi Group High Voltage Line V3.1° according to the severity of the situation and the profit.”
This post first appeared on: BTC Manager