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Binance ordered to stop operations in Malaysia by August, investors to take their money out

On Friday 30 July, Malaysia’s securities commission ordered cryptocurrency exchange Binance to halt its operations in the next 14 days for illegally operating a digital asset exchange.

The commission said Binance must disable both its website and mobile application 14 days from July 26, immediately cease all media and marketing activities, and immediately restrict Malaysian investors from accessing Binance’s group in Telegram, a messaging app.

This comes after the commission already added Binance, the world’s largest cryptocurrency exchange by volume, to the country’s alert list of unauthorized entities in July 2020. All digital asset exchanges, according to the commission, must be registered.

A public reprimand was issued against Binance Holdings Limited, its CEO Zhao Changpeng, as well as three other Binance entities (Binance Digital Limited, registered in the UK; Binance UAB, registered in Lithuania; and Binance Asia Services Pte Ltd, registered in Singapore).

In the past months, Binance has been slapped with multiple warnings, and has, in some jurisdictions, been banned from operating due to its failure to register with local regulators. Malaysia’s clampdown follows other regulators in ItalyThailandHong KongGermany, Japan, and the US going after the exchange.

Gary Worrall, CEO of Crypto Facilities, among the first regulated crypto derivatives exchange in Europe, said his firm “worked hard” to acquire the right licensing.

“Crypto is no longer just a Wild West,” he said.

Also on Friday, Binance announced it will wind down its futures and derivatives products offerings in Germany, Italy, and the Netherlands.

“With immediate effect, users from these countries will not be able to open new futures or derivatives products accounts,” the company said.

Users from these countries will have 90 days to close their open positions.

Binance, which was founded in 2017, has long touted its decentralized operations, and has no formal headquarters. While it was founded in China and officially domiciled in the Cayman Islands, the firm’s scattered physical presence has irked regulators.

But on July 27, Zhao expressed his intention of cooperating with global regulators. He said if authorities expect Binance to have a headquarters, then his firm will establish regional headquarters to have a “very easy to understand structure.”

“We need to be a licensed financial institution everywhere that we operate,” Zhao said.

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