Crypto exchange Huobi was ordered to stop operating in Malaysia by the Securities Commission (SC) of the Asian country. The regulator issued a public reprimand to Huobi CEO Leon Li.
In a May 22 press statement, Malaysia’s SC said Huobi operated in the country illegally because it failed to register as a digital asset exchange (DAX).
The authorities noted this was a severe infraction of its Capital Markets and Services Act 2007, requiring exchanges to obtain licensing from Malaysia’s SC as a Recognised Market Operator (RMO).
Due to this, the exchange has been directed to disable its website and mobile application on several platforms like Apple Store, Google Play, and others.
“Huobi Global Limited has also been directed to cease circulating, publishing or sending any advertisements, whether in email or on social media platforms, to Malaysian investors.”
The financial regulator advised Malaysia-based investors to withdraw all their assets from the platform and immediately close their accounts. According to the SC, their continued usage of the exchange could expose them to “fraud,” and local laws may be unable to protect them. It was added that CEO Leon Li is to ensure the directives were carried out.
The new order comes when Huobi is trying to regain its market footing. The exchange had lost a large share of its market dominance over the past years to rivals after it was forced to close its Chinese operations in 2021.
Li sold his controlling stake
Meanwhile, Huobi founder and CEO Leon Li sold his controlling stake in the crypto exchange to Hong Kong-based asset managers About Capital last October.
Li said the deal would enable the company to accelerate globalization plans, including business expansion initiatives.
At the time, reports indicated Li would depart from the company altogether. However, per his LinkedIn, he continues to hold the CEO position.
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