Bybit in Malaysia Suspends Operations for 14 Days Due to Illegal Activities

Key Points:

• Malaysian Securities Commission (SC) ordered Bybit and its CEO, Ben Zhou, to cease operations and disable their platforms within 14 business days.
• Bybit in Malaysia must halt all advertising, with the SC warning that unregistered platforms expose investors to financial crimes.

The Securities Commission of Malaysia has slapped enforcement actions against Bybit and its CEO, Ben Zhou, for operating a DAX without proper registration. The SC announced the move on Friday, citing regulatory violations and investor protection concerns.

Read more: Bybit Card Now Expands Registration Support to More Regions 

Securities Commission Cracks Down on Bybit in Malaysia for Unregistered Operations

Bybit in Malaysia was ordered to shut down access to its website, mobile applications, and all digital platforms within 14 working days from December 11, 2024. The company is also required to stop running all advertisements targeting investors in Malaysia and shut down the Telegram support group it had been using to handle local customers.

The regulator further highlighted that operating a DAX without being registered as an RMO is in violation of Section 7(1) of the Capital Markets and Services Act 2007. The SC also took further pains to remind these illegal platforms are also putting their users at higher risk of fraud and financial crimes, including investors not afforded the protection provided under the Malaysian securities laws.

The enforcement follows long-standing concerns about Bybit‘s compliance with local regulations. Both the company and its CEO have been on the SC’s Investor Alert List since July 2021. In its statement, the SC emphasized that its actions aim to safeguard investors and maintain market integrity.

Malaysia Requires Strict Compliance to Operate Digital Asset Exchanges

Zhou was ordered to ensure full compliance with the directives, which included immediately ceasing all promotional activities in Malaysia. The SC has confirmed that Bybit in Malaysia has adhered to its orders so far.

The commission also called on investors to use only the platforms registered with the SC, as these go through stringent regulatory checks to ensure legal and financial safeguards. It added that the public should lodge reports on unauthorized investment schemes and be wary of platforms promising impossibly high returns.

Presently, only six crypto exchanges are legally registered to operate in Malaysia.