The Securities Commission Malaysia has targeted the centralized crypto exchange Huobi Global Limited as well as Leon Li (its Chief Executive Officer). The allegation raised by the securities commission against the respective parties is that they have supposedly been operating a digital asset exchange (DAX) within Malaysian jurisdiction without any registration.
Huobi Global Becomes a Prey to the Legal Measures Taken by the Malaysian Securities Commission
As per the agency, the Securities Commission has released an open reprimand confronting the crypto exchange and the CEO thereof for their illegitimate activities in Malaysia. Apart from that, the agency has directed the exchange organization to close its activities within the region. This takes into account the suspension of its official web portal and mobile app on diverse platforms like Google Play, Apple Store, and the rest of the digital application forms.
In addition to this, the crypto exchange has been ordered by the Securities Commission to stop publishing, sending, or circulating any promotions. Hence the advertisements targeting Malaysian investors need to be stopped whether they are in the form of email or are presented on social media. The CEO of the Huobi exchange had additionally been particularly directed to guarantee the implementation of the aforementioned orders.
The respective decision is witnessed after the apprehensions regarding the compliance of the company with the native regulatory requirements. Some concerns have also been raised against its protection of the interests of the investors. The agency has provided great attention to the law infringement carried out by the platform by playing the role of a DAX while it obtained no license from the Securities Commission to operate as a Recognised Market Operator (RMO).
This is considered to be an offence in line with the Capital Markets and Services Act 2007, as mentioned in Section 7(1). The Securities Commission is of the view that investors are advised to deal with and invest in registered RMOs. Registered RMOs are to go through stringent regulatory scrutiny.
The Agency Advises Investors to Consider Investing in Registered RMOs
These entities are also required to comply with the stringent instructions for the protection of the investors under the securities laws of Malaysia. The people who invest in unregistered or unlicensed individuals or companies may incur risks like fraud. These people also may not have protection under the securities laws implemented within the jurisdiction.