The Securities Commission of Malaysia has ordered Huobi Global to cease all activities after it failed to register to operate in the country.
Huobi Global has been ordered to shut down its operations in Malaysia following enforcement action by Malaysian securities regulators.
According to an official statement from the Securities Commission of Malaysia (SCM) on May 22, Huobi Global failed to register as a cryptocurrency exchange operator and must cease all activities. The company has been directed to disable its website and mobile apps on the Apple Store and Google Play.
Cryptocurrency exchanges are also expected to stop promoting their products and services to Malaysian users via email and social media.
SCM noted that its decision was driven by concerns over Huobi’s “compliance with local regulatory requirements.” The regulator also directed Malaysian investors to stop trading on the platform, withdraw funds and close accounts due to the failure to obtain SCM registration.
Huobi Global rebranded in November 2022 after being acquired by About Capital Buyout Fund last month. After news of SCM’s enforcement action broke, a company spokesperson told Cointelegraph that the order had nothing to do with Huobi, which continued to operate after a change in ownership last year:
"In response to recent reports, we would like to clarify that the situation outlined relates to previous Huobi entities and former shareholders. It has nothing to do with the Huobi platform, which is currently subject to strict regulatory compliance globally."
Huobi Global has been on the radar of Malaysia’s securities regulator since August 2022, after SCM issued an investor alert saying the exchange was operating without the necessary licenses in the country.
Following the announcement, Huobi said it was discussing its regional operations with Malaysian regulators. The company initially launched a brokerage called Huobi Labuan in November 2020, with a temporary nine-month period to offer cryptocurrency spot and derivatives trading.
In 2022, cryptocurrency exchange Binance managed to gain a foothold in the Malaysian market by acquiring a stake in regulated trading platform MX Global. By mid-2021, Binance found itself in a similar position to Huobi, having been ordered to cease operations in the region for failing to obtain the necessary regulatory approvals.
According to the SCM website, only four companies are registered as recognized cryptocurrency exchange operators. This includes Luno Malaysia, MX Global, Sinegy and Tokenize Technology. This list was last updated in August 2022.