Yet another cryptocurrency exchange is departing from Canada.
Binance, the largest cryptocurrency exchange in terms of daily trading volumes, is departing from the Canadian market.
The company announced this move on May 12th on Twitter, citing regulatory pressures in Canada's crypto industry.
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In February, the country's regulator, the Canadian Securities Administrators (CSA), introduced a new set of rules for crypto exchanges wanting to operate in the country.
Despite submitting the required preregistration undertaking, Binance found the Canadian market untenable. The company stated in a tweet:
Unfortunately, new guidance related to stablecoins and investor limits provided to crypto exchanges makes the Canada market no longer tenable for Binance at this time.
The new CSA regulations prohibited companies from facilitating crypto contracts for Canadian clients for buying or selling any crypto asset classified as a security or a derivative. The rules also categorize stablecoins as security.
Binance informed its Canadian users through email that they need to close their open positions by September 30th, 2023. Post this date, Canadian customers will be in liquidation mode only. Binance added:
While we do not agree with the new guidance, we hope to continue to engage with Canadian regulators aimed at a thoughtful, comprehensive regulatory framework.
This departure isn't a single move by one crypto exchange. Binance follows several smaller competitors that have already exited Canada due to regulatory issues. Another crypto exchange OKX left the Canadian market in March, followed by the decentralized exchange dYdX and blockchain fintech firm Paxos in April.
However, for Canadian crypto enthusiasts, not all hope is lost. Kraken has filed the new preregistration undertaking and pledged to continue operations in Canada. The CSA also lists 11 platforms authorized to do business with Canadians.
Binance's departure is a setback for the Canadian market, but the crypto scene remains alive, with other willing participants navigating the regulatory landscape.