The Securities Commission of Malaysia (SC) has taken decisive action against cryptocurrency exchange Bybit, citing non-compliance with local regulatory requirements. Bybit has been ordered to suspend its website and mobile applications in Malaysia, halt all advertising activities targeting Malaysian investors, and shut down its local support group. This move underscores the country’s commitment to investor protection and adherence to regulatory standards.
Bybit Faces Regulatory Action in Malaysia
In a recent announcement, the SC revealed that Bybit and its CEO, Ben Zhou, had been operating a digital asset trading platform without proper registration. The regulator has given the platform 14 business days from December 11 to comply with its directives, which include suspending all digital platforms accessible in Malaysia. Additionally, Bybit must cease advertising activities and disband its Telegram support group for Malaysian users.
“This decision follows concerns about the platform’s compliance with local regulatory requirements and the protection of investors’ interests,” the SC stated. Operating a Digital Asset Exchange (DAX) without being registered as a Recognized Market Operator (RMO) is a violation of Malaysia’s Capital Markets and Services Act 2007.
Bybit and Regulatory Compliance
Bybit and its CEO have been listed on the SC’s Investor Alert List since July 2021 for similar violations. The SC emphasized that investors trading on unregistered platforms are not protected under Malaysian securities laws, increasing their risk of falling victim to financial crimes. As of now, only six cryptocurrency exchanges are officially registered to operate in Malaysia.
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In a statement on its Telegram channel, Bybit acknowledged the situation, stating: “We understand this may cause some inconvenience. We look forward to reconnecting with you in the future after obtaining the necessary licenses.”
Bybit’s Global Challenges
This regulatory action in Malaysia follows Bybit’s withdrawal from France in August, where stricter licensing requirements were imposed in preparation for the European Union’s Markets in Crypto-Assets (MiCA) regulation. MiCA aims to establish a unified set of rules for crypto assets across the EU, covering transparency, disclosures, authorization, and oversight for crypto issuers and traders.
Bybit’s recent challenges highlight the increasing scrutiny faced by cryptocurrency exchanges worldwide as governments and regulators seek to ensure compliance and safeguard investors.
The Bit Journal’s Insight
As the cryptocurrency landscape evolves, exchanges like Bybit must adapt to stringent regulations to maintain their global presence. The The Bit Journal will continue to monitor developments in Malaysia and other regions as regulatory frameworks shape the future of digital asset trading.
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