Malaysia’s regulator pulls up Huobi crypto exchange

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Malaysia’s mar­ket reg­u­la­tor the Secu­ri­ties Com­mis­sion (SC) has asked cryp­tocur­ren­cy exchange Huo­bi Glob­al to stop its oper­a­tions in the coun­try, and pulled up the exchange and its chief exec­u­tive offi­cer Leon Li for oper­at­ing a dig­i­tal asset exchange (DAX) with­out reg­is­tra­tion, in an announce­ment Mon­day. The SC also urged Malaysian users on the plat­form to imme­di­ate­ly cease trad­ing, with­draw all invest­ments and close accounts.

See relat­ed arti­cle: Malaysia to get its own nation­al pub­lic blockchain

Fast facts

  • “The SC views this breach seri­ous­ly, as oper­at­ing a DAX with­out obtain­ing the SC’s reg­is­tra­tion as a Recog­nised Mar­ket Oper­a­tor (RMO) is an offence under Sec­tion 7(1) of the Cap­i­tal Mar­kets and Ser­vices Act 2007,” the SC said.
  • The reg­u­la­tor has asked Huo­bi Glob­al to refrain from cir­cu­lat­ing, pub­lish­ing or send­ing any adver­tise­ments to Malaysian investors through email or social media. It has also asked Huo­bi to dis­able its web­site and mobile appli­ca­tion on plat­forms includ­ing Apple Store and Google Play.
  • The SC point­ed out that reg­is­tered RMOs under­go rig­or­ous reg­u­la­to­ry scruti­ny and are required to fol­low strict guide­lines which enables investors to be pro­tect­ed under Malaysia’s secu­ri­ties laws. 
  • This is not the first time the SC has charged Huo­bi for oper­at­ing in the coun­try with­out a reg­is­tra­tion. On Aug. 22 last year, the reg­u­la­tor said it added Huo­bi Glob­al to SC’s investor alert list for oper­at­ing with­out reg­is­ter­ing with the SC.
  • Huo­bi said in its user agree­ment that users from nine juris­dic­tions are pro­hib­it­ed from using its ser­vices, includ­ing main­land Chi­na, U.S. and Sin­ga­pore, while users from 13 juris­dic­tions are banned from trad­ing in deriv­a­tives, includ­ing the U.K., New Zealand, and China.
  • Huo­bi, which announced plans in Novem­ber to increase invest­ments in South­east Asia and Europe as part of its glob­al expan­sion, said in Jan­u­ary that it was cut­ting 20% of its staff.
  • In Feb­ru­ary, the exchange said it would relo­cate its Asia head­quar­ters from Sin­ga­pore to Hong Kong, and would increase its head­count from 50 to 200 in Hong Kong. 
  • See relat­ed arti­cle: Ant Group, Malaysian invest­ment bank Kenan­ga devel­op cryp­to wealth app



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