Key Takeaways:
- Malaysia’s Securities Commission (SC) reprimands Bybit and its CEO, Ben Zhou, for operating without registration.
- Bybit must cease operations, disable its platforms, and stop advertisements in Malaysia.
- Investors are urged to engage only with registered digital asset exchanges.
The Securities Commission Malaysia (SC) has taken decisive action against Bybit Technology Limited and its CEO, Ben Zhou, for operating a digital asset exchange (DAX) without proper registration. Bybit has been listed on the SC’s Investor Alert List since July 2021.
In the most recent order, the SC directed Bybit to disable access to its website, mobile applications, and digital platforms in Malaysia within 14 working days starting from December 11, 2024. It has also ordered the platform to immediately stop airing its advertisements targeting Malaysian investors, and to shut down the Telegram support group it serves to locals.
These actions follow increasing concern that Bybit has failed to comply with Malaysia’s regulatory requirements, putting investor protection at increased risk. According to Malaysia’s Capital Markets and Services Act 2007, concerns involve a DAX operation without the necessary registration with the SC.
Strict Directives Issued to Bybit and CEO Ben Zhou
As the CEO of Bybit, Ben Zhou is personally liable to comply with all directives by SC. Viewed in a very serious light by the SC, unregistered platforms more often than not expose investors to higher risks of fraud and money laundering. That is why Malaysia’s regulatory framework dictates a set of stringent requirements under RMO guidelines that are there to protect investors through laws on securities.
Meanwhile, SC has also warned the people to be constantly vigilant and to only deal with registered operators; the operation of any institution without proper regulatory approval lacked the efficiency of providing all the substantial information concerning transparency and the protection of investors with financial safety.
Investor Caution Amid Rising Digital Asset Risks
Given this, it is strongly recommended that Malaysian investors check on the status of the digital asset platform offering before indulging in any deal, as investment in an unlicensed one means it is in contravention of the law and not protected against possible losses or fraud.
It further called upon the public to report to it any suspicious platforms, websites, and unsolicited investment offers which promised unreal returns. This was another incident that shows that the greatest challenge for digital asset growth is regulatory compliance with maintaining market integrity and the protection of investor interest.
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