The ringgit rose as much as 1.2 per cent to 3.9700 per dollar, its strongest since May 4.
The Malaysian currency was quoted earlier than usual as investors were keeping an eye on the Britain's referendum to stay or leave the union.
The UK pound plunged as early results of the referendum on whether to stay in the European Union (EU) showed the leave camp in the lead, although later results put remain ahead and spurred a recovery in the currency.
Early results had shown the leave camp had as much as nearly 53 per cent of the vote. That sent the pound tumbling as low as US$1.4040 (S$1.89).
The pound took a particular hit from early results from Sunderland, which showed the city voted 61.3 per cent in favour of leave, a stronger than expected outcome.
"While the Northern areas were always expected to favour a Brexit given the age and income demographics, the margin of win for leave has come in at a high enough level to unsettle market expectations of a comfortable Bremain win," Mizuho said in a morning note Friday after the Sunderland results.
The working-class region of Sunderland in the north-east of England reported a higher-than-expected vote to leave, causing markets to react negatively with the pound, oil and gold prices falling after the result. Sunderland is seen as a bellwether of whether the leave campaign has managed to sway a blue-collar demographic, according to the think tank Open Europe.
But as fresh results put remain back on top and the pound recovered, with the pound fetching US$1.4514 at 9:39 am.
That roller-coaster action followed an earlier surge in the the pound to as high as US$1.5018 from around US$1.48 on Thursday after an initial exit poll from YouGov showed 52 per cent of respondents favoured staying in the EU, while 48 per cent preferred leaving. The survey of 4,772 people involved the polling firm going back to voters it had spoken to previously to ask how they voted.
The pound had initially also gotten a tailwind after a key Brexit campaigner, UK Independence Party leader Nigel Farage, announced early on Friday that he believed the remain camp had "nicked it."
But fresher official results at around 9:43 a.m. SIN/HK showed that with 79 out of 382 areas reporting, remain had 50.8 per cent of the vote, while leave had 49.2 per cent. Voting turnout was as high as 70 or 80 per cent in many local areas.
"I think this is all due to 'preset' trades: computer generated transactions which have been based on the results of the initial votes," said Chris Gaffney, president of Everbank World Markets, which has around US$26.6 billion in assets.
He expected the jarring swings to continue, even though he said results still appeared to point to the remain camp carrying the day.
"Every vote report will generate another big move in the currency markets and at least some carryover to the other markets," he said.
Other analysts also had a straightforward explanation for the wild swings.
"The responses to each result have been straightforward," DBS said in a morning note Friday. "It's'risk on' when remain prevails, and 'risk off' when the leave camp leads."
Before the Sunderland results came in, Jim Rickards, editor of Strategic Intelligence, told CNBC's "Rundown" that "the market was priced for remain, but if leave wins, there's going to be an earthquake."
Other analysts agreed, with markets remaining on edge.
"Throughout Asian markets, while results are being received, a Brexit carries with it the potential for flash crash," Andreas Tjahja, senior dealer at spreadbettor easyMarkets, said in a note early Friday after the Sunderland result.
That fear of a Brexit has been driving currency trade recently. Some foreign-exchange traders noted that over the past week or so, customers were "panic buying" euros and dollars to protect themselves in the event the leave camp won the referendum.
Sakthi Ariaratnam, global director of Thomas Exchange Global in London, said that volume had been exceptional over the past couple of days, with many customers buying other currencies ahead of their vacations in case a possible Brexit sent the pound lower.
Some customers had told him other exchanges had run out of euros.
Another factor that may be weighing on the pound: Some analysts had predicted that the pound's rally in the lead-up to the referendum would evaporate in profit-taking if a remain win was confirmed; the pound was trading as low as around US$1.40 last week.
"I call to people's attention the age-old market wisdom that you sell on the good news and fundamentally the rally of the last couple weeks has been predicting remain would prevail," Ken Fisher, CEO of Fisher Investments, told CNBC's "Squawk Box." Fisher Investments had around $65 billion in assets under management at the end of the first quarter.
Other currencies took a similar trajectory as the pound.
The safe-haven yen had weakened before the Sunderland result, with the dollar fetching as much as 106.81 yen, compared with levels near 104.43 yen on Thursday afternoon Asia time, before tumbling as low as 103.61 yen in the wake of the Sunderland count. At 9:41 am, the dollar was fetching 104.84 yen.