On Friday Binance made the announcement that it was joining other prominent crypto businesses to withdraw from Canada, in response to the country’s newly issued series of guidelines for cryptocurrency exchanges which includes investor limits and mandatory registrations.
In recent months, Canada has tightened regulations for crypto asset trading platforms by instituting a pre-registration process. Companies that do not follow the rules may face enforcement action, according to the Ontario Securities Commission’s website.
“Unfortunately, (the) new guidance related to stablecoins and investor limits provided to crypto exchanges makes the Canada market no longer tenable for Binance at this time,” Binance said in a tweet.
Apparently, with this action, Binance has made it known that it does not agree with the new guidelines and hopes to engage with Canadian regulators to develop a comprehensive framework for crypto operations in the country.
The full statement reads:
Unfortunately, today we are announcing that Binance will be joining other prominent crypto businesses in proactively withdrawing from the Canadian marketplace.
We would like to thank those regulators who worked with us collaboratively to address the needs of Canadian users. Albeit a small market, it held sentimental value for us as the home country of our founder. We had high hopes for the rest of the Canadian blockchain industry. 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. We put off this decision as long as we could to explore other reasonable avenues to protect our Canadian users, but it has become apparent that there are none.
Our remaining Canadian users are receiving an email with comprehensive information on how this will impact their accounts going forward. 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. We are confident that we will someday return to the market when Canadian users once again have the freedom to access a broader suite of digital assets.
The digital assets industry has been on the radar of regulators worldwide, particularly since the November collapse of Binance-rival FTX, which triggered a market rout in the prices of the largest digital coins.
Following the onset of the 2022 crypto winter, which wiped out more than a trillion dollars from the industry’s market value, lawmakers and securities regulators demanded stricter guidelines for crypto companies’ disclosures on how they operate and hold customer funds.
The US Commodity Futures Trading Commission sued Binance and its CEO Zhao in March for operating an “illegal” exchange and a “sham” compliance program, according to the regulator.