The Securities Commission Malaysia (SC) has ordered cryptocurrency exchange Huobi Global to cease operating in the country, noting that the platform possesses no requisite authorization or registration. Additionally, the securities regulator asked the exchange to disable its website and mobile application on various platforms, such as Apple and Google Play Stores.
The SC announced the enforcement action on Tuesday, noting that it had ordered Huobi to stop circulating or publishing any advertisements targeted at Malaysian investors whether through email or social media platforms. The watchdog said it was concerned about the Seychelles-based crypto exchange's compliance with local regulatory requirements and the protection of investors' interests.
According to SC, Huobi's lack of registration as a Recognized Market Operator (RMO) violates the country's capital markets law. As a result, the financial markets supervisor ordered Leon Li, Huobi's CEO, to ensure compliance with the directives.
Finance Magnates reported that Huobi had secured initial approval to operate in Malaysia in late 2020. The firm launched 'Huobi Labuan' after the watchdog had granted it an initial nine-month period to meet its regulatory standards.
In August 2021, Binance shut down its services in Malaysia after the SC slammed the platform for operating illegally in the country.
SC Warns Malaysian Investors
In the announcement, the SC warned Malaysian investors that patronize Huobi to immediately halt trading on the crypto exchange's platform. On top of that, it advised them to withdraw their investments from the platform and shut down their accounts.
Additionally, the regulator urged investors to engage with only RMOs which it said had undergone "strict regulatory scrutiny" and are required to adhere to strict guidelines to protect investors under the country's securities laws.
"Those who invest with unlicensed or unregistered entities or individuals are exposed to risks such as fraud and may not be protected under Malaysian securities laws," the SC said in the statement.
Meanwhile, while Malaysia is participating in Project Dunbar, a central bank digital currency exercise led by the Bank of International Settlements (BIS) Innovation Hub in partnership with Australia, Singapore and South Africa's apex monetary authorities, the country appears not friendly towards accepting crypto as a legal tender.
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This article was written by Pedro Ferreira at www.financemagnates.com.
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