Key Takeaways
- Malaysia’s Securities Commission ordered Bybit to shut down operations for violating securities laws and operating without a license.
- The exchange must disable platforms, block access, and terminate ads targeting Malaysian investors within 14 business days.
- The SC warned investors to use only licensed platforms, highlighting compliance rules and risks tied to unregulated exchanges.
Malaysia’s Securities Commission (SC) has ordered Bybit, a global cryptocurrency exchange, to cease operations for operating without a license. Notably, the regulator accused Bybit of violating local securities laws by offering digital asset services without proper registration.
Per the release from the Malaysian regulator, the enforcement action requires Bybit to shut down its website and mobile applications in the country within 14 business days, starting December 11, 2024. Meanwhile, the directive requires the exchange firm to block access to its services and disable any platforms that facilitate trading for Malaysian users.
In addition, Bybit must also immediately halt advertisements targeting Malaysian investors, including social media posts and promotional content. Furthermore, the SC directed the platform to terminate its Malaysian Telegram support group to prevent further user engagement.
Malaysia SC: Regulatory Crackdown on Unlicensed Crypto Exchanges
Malaysia’s securities authority emphasized its commitment to protecting investors and maintaining market integrity.
“This decision comes after concerns about the platform’s compliance with local regulatory requirements and protecting investors’ interests. The SC views this breach seriously, as operating a DAX [digital asset exchange] 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,” said the SC in the release.
Bybit’s suspension highlights Malaysia’s tightening regulations on cryptocurrency exchanges amid rising adoption. Then, it signals a broader push for compliance and investor protection in digital asset markets.
Future Compliance Measures
The Malaysian regulator urged Investors to use only SC-registered platforms that follow strict regulatory standards to ensure legal protection under Malaysia’s securities laws.
Also, the SC warned against unlicensed entities, which pose fraud risks, and urged Malaysians to report such suspicious schemes promising high returns with minimal risks.
Regulators worldwide are increasingly scrutinizing crypto exchanges as the industry expands. Observers expect stricter AML (anti-money laundering) rules and KYC (know-your-customer) checks to follow.
