Malaysia’s Securities Commission (SC) has directed crypto exchange Bybit and its CEO Ben Zhou to cease all operations within the country.
In a recent press statement, the financial regulator explained that the order stems from Bybit’s failure to secure the authorization to operate as a digital asset exchange (DAX) under local regulations.
Regulatory crackdown
The SC expressed concern over Bybit’s non-compliance with local laws, emphasizing the importance of safeguarding investors.
Under Malaysia’s Capital Markets and Services Act 2007, operating a DAX without obtaining approval as a Recognized Market Operator (RMO) is illegal. The SC highlighted the seriousness of this breach and its potential risks to the public.
Following this action, the Malaysian authorities have directed Bybit to turn off its website and mobile applications by Dec. 25. The regulator has also demanded the cessation of promotional efforts aimed at Malaysian investors and the immediate termination of the platform’s Telegram support group for users in the region.
According to the SC, its decision occurred three years after Bybit and Zhou were placed on its Investor Alert List in July 2021. This list highlights unregistered entities and individuals Malaysian investors are advised to avoid.
The regulator’s Investor Alert List also includes other prominent platforms, such as Bitget and Atomic Wallet, which operate without registration.
Considering this, the SC has urged investors to deal only with approved RMOs, which undergo rigorous scrutiny to meet legal and operational standards.
While cryptocurrencies are legal in Malaysia, they are not classified as legal tender. The SC oversees their regulation, imposing strict compliance requirements on operators. According to the SC’s records, only six exchanges are licensed to operate within Malaysia.
Bybit’s compliance efforts
Social media posts revealed that Bybit had blocked login access for Malaysian users since Dec. 24, citing regulatory compliance efforts. The exchange announced plans to re-enter the market once it secures the necessary licenses.
Meanwhile, Bybit’s regulatory challenges extend beyond Malaysia. The exchange recently announced plans to suspend withdrawal and custody services for French users starting Jan. 8, 2025, due to increased oversight from French authorities.
Launched in 2017, Bybit is one of the largest crypto exchanges globally, managing over $16 billion in assets, according to CoinMarketCap data.
Mentioned in this article
Credit: Source link