"Not only did he promote the sport through his performances but he time and time again would make himself available for come and try days or development camps to speak to new athletes and guide new bladrunners coming through the system.
"It's sad to see Liam step away from the sport but at the same time it's a very tough decision for anyone to make so we should definitely commend him for knowing when the time was right for him and making that call."
Watton said he wished Malone well in life after the sport.
Malone said he made the "difficult" decision due to a number of factors, but ultimately lacked the motivation to continue in the sport in the countdown to the 2020 Tokyo Paralympic Games.
"Over the last month I have been reflecting on my position and I have made the difficult decision to retire my running career effective immediately," Malone said in a statement.
Read more: Why Liam Malone treasures his silver medal most
"External events both in and out of my control have taken a toll on my training in the last month and I don't feel I have the emotional investment or necessary focus and energy to succeed at the highest level in Tokyo.
"Becoming an elite athlete was an incredible journey but life is short, I want to find something that I can commit to and be happy in for a long time. It would be unjust to commit half-heartedly to those who support me, my coach, the supporting organisations, the New Zealand public, sponsors, my friends and family."
Malone had both legs amputated below the knee at 18 months old, being born with a fibular hemimelia – in which part or all of the fibula bone is missing.
Malone took up athletics while studying at the University of Canterbury in 2014.
The following year he made his international debut, finishing fifth and sixth in the T43 100m and 200m respectively.
He made his name on the top stage in 2016, securing double gold and a pair of Paralympic records in the T44 200m and 400m, and claimed a silver in the T44 100m.
The 24-year-old had recently engaged with High Performance Sport New Zealand (HPSNZ) in their Goldmine initiative to develop new blades for the Tokyo 2020 Games, but this project will now be put on hold following the news.
Athletics New Zealand chief executive Hamish Grey praised the impact Malone made on the sport in New Zealand in a short time, and congratulated Malone on his career.
"The door will always be open for Liam at Athletics New Zealand and we will continue to support Liam wherever possible. I have no doubt Liam will succeed in his future endeavours".