The Securities Commission Malaysia (SC) has taken action against crypto trading platform Huobi Global, and its CEO Leon Li for operating a digital asset exchange (DAX) in Malaysia without registration.

The SC is urging Malaysian investors who have been using Huobi Global to immediately cease trading through its platform, withdraw all their investments, and close their accounts.

The commission has ordered Huobi Global to stop its operations in the country, including to disable its website and mobile application on Apple Store, Google Play and any other digital application platform.

Huobi Global has also been directed to cease circulating, publishing or sending any advertisements, whether in email or on social media platforms, to Malaysian investors.

The regulator had already placed Huobi on its on its investor alert list for operating illegally in Malaysia back in August 2022.

Huobi had previously issued a misleading statement that it had secured a license from the “Malaysian authorities” to provide a “safe and regulated way to trade cryptocurrencies” in the country in November 2020.

The SC said that Huobi was only allowed to operate within the jurisdictions of Labuan and needed additional approval to offer its crypto trading services outside of Labuan.

The regulator released a statement saying,

“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 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.”

There are currently only two platforms that the SC has registered as Initial Exchange Offering (IEO) operators; the recently launched Kapital DX (KLDX) as well as equity crowdfunding platform pitchIN which aims to launch its own IEO platform this year.