As the cryptocurrency market picks up steam, numerous exchange services have entered the arena. Each presents a different mix of fees, pairing, geographical quirks, and user interfaces.
Huobi is a Singapore-based exchange with a focus on customer service and independent cryptocurrency analysis. Founded in 2013, Huobi is still very much centered on the Asian market, with offices in Japan, Korea, and Hong Kong, in addition to its head Singapore office. Huobi does maintain a single office in the U.S. However, as of May 2018, Huobi warns U.S. visitors to its site that it cannot accept their registrations due to U.S. regulatory laws. The company has stated that it intends to open a service for U.S. citizens in the near future, based out of its San Francisco, California, location.
This review will focus on the nuts and bolts of trading on Huobi, as well as features unique to the exchange, including its coin pairings, security features, and trading tools. We’ll also take a look at Huobi’s customer service model, which Huobi claims was the first 24/7 cryptocurrency customer service unit in existence, and Huobi’s special investor protection fund.
Huobi Account Signup
Account creation on Huobi is relatively simple. The link to create an account is in the top-right corner of the homepage. The sign-up screen first asks you to select your country of origin, with a warning that it cannot be changed once entered. Huobi boasts the ability to operate in over 130 countries. Tellingly, however, the United States is not given as a possible nationality option. The most frequently selected nationalities as of May 2018 are China, Hong Kong, Taiwan, Japan, Korea, Germany, the United Kingdom, and Canada.
The username you select can be either a telephone number or an email address. Huobi warns that email address verification might be erroneously marked as spam, so it’s important to check your spam folder for the verification email once you create an account.
Once you have created your account, verified the email and then logged in for the first time you are presented with a welcome screen which offers you the choice of purchasing some cryptocurrency with Chinese Yuan (CNY), US dollars (USD) and Singapore dollars (SGD) using their OTC service or transferring some which you already own to the exchange.
How to Trade on Huobi
Once you’ve created an account, it’s time to visit the basic exchange. Huobi offers USDT, BTC, and ETH pairings. There are just over 40 USDT pairings, about 100 BTC pairings, and a similar number of ETH pairings. The pairings are divided into categories according to how long they’ve been on Huobi and whether they are a fork of an existing coin. All pair prices can be viewed in terms of the trading pair or U.S. dollars.
The main trading screen is fairly comprehensive with all available trading pairs located on the left in their own sidebar.
An interactive candlestick chart dominates the right side of the screen which is powered by Trading View, so gives you access to a whole range of Technical Analysis tools such as Bollinger Bands, Moving Averages and so on.
The order forms are directly below the chart, allowing you to buy and sell with limit orders or market orders. On the right of this is the selected coin’s recent prices and orders.
Below these tools are a market depth chart, a running tally of market trades, and an extremely useful section detailing each coin’s personal statistics. This makes Huobi’s exchange tool really pop in comparison to other exchanges, like Binance.
At a glance, a potential trader can get a look at any given coin’s total supply, circulating supply, website, white paper, and more. This setup greatly reduces the do-your-own-research factor of cryptocurrency trading by presenting most of the applicable information in a handy box directly on the exchange screen. This information is further expounded upon in Huobi’s asset introduction page, accessible by clicking the “Help” link at the bottom of the screen.
Making Your Trades
After funding your wallet with the cryptocurrency of your choice, Huobi allows you to jump directly into the markets via their exchange screen. Two types of orders are support – limit and market.
The trading interfaces for both are largely self-explanatory. Prices are displayed in both the potential pairing and U.S. dollars, and the amount can be manually entered or selected with a slider. The slider is a particularly useful tool for visualizing the share of your current pool of coins that you plan to stake in a trade. Dragging the slider all the way to the right signifies that you are going all-in, dragging it halfway assumes you are taking half of your coins to market, and so on.
Other Trading Options
In addition to the basic trading interface, Huobi offers two complimentary trading platforms.
The HADAX – Huobi Autonomous Digital Asset Exchange – platform grants professional traders access to an even more Wild West version of the regular cryptocurrency market. Huobi does not independently verify the investment value of coins and tokens registered to trade on the HADAX system, as it does on the primary Huobi platform. HADAX users vote for token listings, which are then verified by HADAX to be authentic and legitimate. To become a HADAX user, investors have to meet minimum investment standards due to the higher risk involved in trading these coins and tokens.
Should a coin or token be accepted on the HADAX platform, it has the potential to be listed as a new coin on the Huobi main trading site, provided it meets Huobi’s investment standards. Removal of a coin from Huobi does not necessarily mean it will be removed from HADAX.
The OTC, or over-the-counter, section of Huobi offers potential buyers and sellers a way to move large quantities of coins without exposure to the fickle exchange market. Certified merchants can register here, and slippage can be minimized by matching buyers and sellers directly instead of creating market orders.
OTC cryptocurrency trades are typically made when the size of the buy or the sale is likely to be large enough to move the market on its own, or when time becomes a significant factor.
Huobi also offers margin trading. Margin trading is a different animal from the basic exchanges. Funds borrowed from a broker are used to trade a given cryptocurrency, and the cryptocurrency serves as collateral for the broker’s loan. Both long and short positions can be taken. This has the potential to magnify both gains and losses, and so it is only recommended for experienced and knowledgeable professional traders. Margin trading requires a level of market understanding that allows a trader to see several steps ahead into a coin or token’s future. Missteps can be extremely costly, but also extremely lucrative.
Before using the Margin Trading part of Huobi, there is an extra Lending Transaction agreement which must be confirmed before proceeding.
Huobi’s trading options really run the gamut from simple to complex. There is a trading platform available for most any need, be it minimizing slippage on large buys or risky moonshots on unproven coins.
Despite the plethora of trading options available, Huobi has a rather simple fee system. Both maker and taker fees are currently set for almost all trading pairs at 0.2 percent.
Maker fees are assessed when adding liquidity to Huobi’s order book via a limit order under the last buy trade price and above the last sell trade price. Taker fees are likewise assessed when liquidity is removed from the order book via an order executed against the given order. The fees are always deducted from the executed total in the value of the final coin.
Huobi offered a tiered VIP trading fee discount program that can be purchased with Huobi’s native token, the HT. The discounts range from 10 to 50 percent.
Huobi Token: The Native Cryptocurrency of Huobi
Like Binance’s BNB and Kucoin’s KCS, Huobi sports its own cryptocurrency. The HT can be purchased via the exchange, and it is given out as part of loyalty and new user reward programs. HT has a total supply of 500 million, and Huobi buys back a certain portion of the coins regularly to serve as an emergency user protection fund. As of May, HT was trading at $2.679.
Is Huobi Safe?
Huobi takes cryptocurrency security professionalism to a high level. Global financial titan Goldman Sachs assists in the exchange’s security and risk control, while the exchange itself utilizes the HT token to set up an investor security fund. The independent cryptocurrency analysis system is designed to keep potentially malicious coins from being traded on the exchange’s main site. In addition, Huobi benefits from the inherent security of a decentralized and hardened anti-DDOS structure.
ID verification is available, as is two-factor authorization for trades and withdrawals. Over 98 percent of investor funds are placed in cold storage to defend against hacks. As of May 2018, Huobi has been the victim of hacking attempts, but no customer funds were lost in those attempts.
It’s worth exploring Huobi’s fairly unique investor security fund in a little more detail, as its existence serves as a market of the exchange’s commitment to staying power in the market.
Using 20 percent of the transaction fees it collects each season, Huobi buys back its own HT and sets them aside for loss compensation. Additionally, Huobi reportedly maintains a 20,000 BTC reserve owned by the platform and stored in an independent address. Should the exchange ever be catastrophically attacked, the BTC are slated to be released to cover investors’ losses. This does not cover losses that occur as a result of hacking or phishing attempts on individual users, but the exchange as a whole is basically self-insured. It’s estimated that the 20,000 BTC reserve holds more value than the exchange’s total hot wallet capacity, permitting an immediate replacement of those funds in the event of a devastating – and unlikely – hack.
Huobi Customer Support
Huobi prides itself on having the best customer service in the cryptocurrency exchange space, and it’s hard to argue with that evaluation. Its 24/7 customer service model takes a cue from traditional markets and was the first of its kind to be implemented. A 24/7 model also demonstrates Huobi’s global reach; geographic and temporal distance from Huobi’s headquarters are not barriers to receiving customer service.
The company website has a full complement of FAQ and help sections, albeit distributed by topic and platform rather than centrally located. For some users, this might be seen as more convenient, as FAQ and help topics are limited to the operation at hand. For others, however, it might be frustrating to dig through multiple sites to get answers to an assortment of unrelated questions.
It’s encouraging that Huobi is working on complying with U.S. regulations to enable U.S. citizens to use its platform because Huobi brings some much-needed professionalism to the cryptocurrency space. Its basic trading tools are simple to use and understand. An independent analysis of listed coins culls the absolutely massive herd of marginal coins and tokens that might be invested in while giving potential traders enough choice to find opportunities. The advanced trading tools will prove to be more and more useful over time, as the derivative market for cryptocurrencies expands. Moreover, Huobi offers a sort of tiered risk system, beginning with its OTC offerings and ending with the HADAX platform.
There has been some information come to light which suggests Huobi might have been falsifying trading volumes, which you can read more about here.
In terms of security, Huobi is making strides toward achieving the same level of respectability as traditional banks and stock exchanges. Not only does Huobi hedge against potential hacks with its centralized security apparatus, it helps users to safeguard their own funds via comparatively strict identification standards and two-factor authorization. Moreover, it physically sets money aside to recover investors’ potential losses in the event that its homegrown security systems fail. This is a feature that’s fairly rare in the cryptocurrency space but almost mandatory for traditional markets. This alone makes Huobi a fine entrance point for the Average Joe into cryptocurrency.
That really is what makes Huobi close to the total package for advanced cryptocurrency trading. New investors can rely on an easy-to-use, graphical trading platform with help and support available at every step. More experienced hands can try their luck – and skill – in the margin-trading market or by diving into the wilderness of HADAX. Huobi seems to have it all for most any investor, regardless of skill or experience. It’s just a shame that the huge potential pool of U.S. investors cannot currently take advantage of the platform.