Malaysia Crackdown Unlikely to Affect Binance, eToro

Malaysia’s financial watchdog has said Binance and eToro don’t comply with the country’s securities law; it’s unlikely to make much of a difference to their local operations, however.

Jul 17, 2020 at 4:58 p.m. UTC
Updated Sep 14, 2021 at 9:32 a.m. UTC

Malaysia’s financial watchdog says Binance and eToro don’t comply with the country’s securities law; it’s unlikely to make much of a difference to their local  operations, however. 

  • The Malaysian Securities Commission (SC) added exchanges Binance and eToro, which offer a series of crypto-based products, to a list of companies not permitted to operate in the country.
  • The regulator blacklists companies that offer financial services without its approval or authorization. 
  • It’s not clear when the SC added Binance and eToro to its non grata list. An official told CoinDesk that this information was not readily available.
  • Binance tested its newly launched debit card in Malaysia. The country’s currency, the ringgit, has been supported in Binance’s  peer-to-peer platform since March.
  • In May, the SC told local media that eToro was not authorized to operate in the country and was liable for a $2.4 million fine. 
  • Being blacklisted by the SC, however, is unlikely to disrupt either Binance’s or eToro’s local operations.
  • The SC does not have the authority to block websites – that rests with the Malaysian Communications and Multimedia Commission (MCMC), which so far has said nothing on the matter. 
  • An eToro spokesperson told CoinDesk the company’s Asian operations are all regulated by the Australian Securities and Investments Commission; Malaysian clients are effectively onboarded on an entity that falls out of the SC’s jurisdiction. 
  • Binance has resisted calls to publicly divulge where it's headquartered. 
  • Bobby Ong, COO of price aggregator CoinGecko, which is based in Malaysia, said the SC may have fired a warning shot as Binance did not get the proper licenses before it started offering a ringgit gateway for its peer-to-peer marketplace.
  • Binance is one of the most high profile exchanges, but Ong said there were many other unregulated p2p ones operating in Malaysia. 
  • Binance did not respond to numerous requests for comment. 
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