Please enter and activate your license key for Cryptocurrency Widgets PRO plugin for unrestricted and full access of all premium features.
Search
Close this search box.

Canada Gives 30-Day Registration Ultimatum to Crypto Exchanges

On Wednesday, the Canadian Securities Administrators (CSA) published a notice with enhanced regulatory guidelines around “investor protection commitments” for cryptocurrencies , mandating the registration of crypto exchanges.

According to the official press release, the crypto asset trading platforms (CTPs) operating in Canada must provide a pre-registration undertaking with the country’s securities regulatory within the next 30 days and initiate a full registration process.

The pre-registration undertaking would include enhanced expectations regarding the custody and segregation of client crypto assets and prohibiting the offering of margin or leveraged crypto products. Further, the Canadian regulator prohibits the exchanges from facilitating the purchase and deposits of stablecoins.

The crackdown on stablecoins by Canadian regulators was initiated last year when the CSA labeled such cryptocurrencies “securities and/or derivatives.” Thus, exchanges need the written consent of the CSA to offer stablecoins.

“Recent insolvencies involving several crypto asset trading platforms highlight the tremendous risks associated with trading crypto assets, particularly when conducted on unregistered platforms based outside of Canada,” said Stan Magidson, the CSA Chair and Chair and CEO of the Alberta Securities Commission.

Too Tough Regulations?

Crypto exchanges unable to comply with the pre-registration undertaking are expected to offload their Canadian clients and need to block the jurisdiction for offering services.

“Specifically, the enhanced PRU will include additional commitments from the CTP to hold assets, including cash, securities, and crypto assets that are not securities, of a Canadian client,” the notice elaborated. “In the case of crypto assets, in a designated trust account or in an account designated for the benefit of clients with a custodian that comes within the definition of ‘Acceptable Third-party Custodian’.”

Earlier, the regulators in Canada took action against multiple cryptocurrency exchanges for violations of local regulations. Last year, the Ontario Securities Commission banned Kucoin from offering services within its jurisdictions and slapped a hefty fine on Bybit, a crypto derivatives exchange. Furthermore, the same regulator took action against the crypto exchange Poloniex for securities law breaches. Binance, the largest crypto exchange in terms of trading volume, shuttered its services in Ontario in 2021, citing mounting regulatory pressure.

On Wednesday, the Canadian Securities Administrators (CSA) published a notice with enhanced regulatory guidelines around “investor protection commitments” for cryptocurrencies , mandating the registration of crypto exchanges.

According to the official press release, the crypto asset trading platforms (CTPs) operating in Canada must provide a pre-registration undertaking with the country’s securities regulatory within the next 30 days and initiate a full registration process.

The pre-registration undertaking would include enhanced expectations regarding the custody and segregation of client crypto assets and prohibiting the offering of margin or leveraged crypto products. Further, the Canadian regulator prohibits the exchanges from facilitating the purchase and deposits of stablecoins.

The crackdown on stablecoins by Canadian regulators was initiated last year when the CSA labeled such cryptocurrencies “securities and/or derivatives.” Thus, exchanges need the written consent of the CSA to offer stablecoins.

“Recent insolvencies involving several crypto asset trading platforms highlight the tremendous risks associated with trading crypto assets, particularly when conducted on unregistered platforms based outside of Canada,” said Stan Magidson, the CSA Chair and Chair and CEO of the Alberta Securities Commission.

Too Tough Regulations?

Crypto exchanges unable to comply with the pre-registration undertaking are expected to offload their Canadian clients and need to block the jurisdiction for offering services.

“Specifically, the enhanced PRU will include additional commitments from the CTP to hold assets, including cash, securities, and crypto assets that are not securities, of a Canadian client,” the notice elaborated. “In the case of crypto assets, in a designated trust account or in an account designated for the benefit of clients with a custodian that comes within the definition of ‘Acceptable Third-party Custodian’.”

Earlier, the regulators in Canada took action against multiple cryptocurrency exchanges for violations of local regulations. Last year, the Ontario Securities Commission banned Kucoin from offering services within its jurisdictions and slapped a hefty fine on Bybit, a crypto derivatives exchange. Furthermore, the same regulator took action against the crypto exchange Poloniex for securities law breaches. Binance, the largest crypto exchange in terms of trading volume, shuttered its services in Ontario in 2021, citing mounting regulatory pressure.

Share this article
Facebook
Twitter
LinkedIn
WhatsApp
Email
More Articles

The Latest Block Newsletter

Subscribe Now

Sign up for our exclusive email list and be the first to hear of
our weekly summarization of Crypto and Fintech News