Canada Takes Action on Crypto Trading Platforms: New Registration Requirements Ahead

Canada’s New Crypto Regulations: A Call to Action

In a significant move to tighten the reins on the crypto market, the Canadian Securities Administrators (CSA) announced a new requirement for crypto trading platforms. As of Monday, these platforms must provide a preregistration undertaking to their principal regulators. This initiative aims to ensure compliance with securities regulations as the crypto landscape continues to evolve.

The Preregistration Undertaking Explained

To keep the crypto train rolling, platforms like Crypto.com and Coinsquare Capital Markets have already jumped aboard by filing their undertakings with the Ontario Securities Commission. But what’s in this undertaking? In simple terms, platforms will have to agree to comply with specific terms and conditions designed to protect investors. This allows them to continue operations while their applications for full registration are under review. Think of it as getting a VIP pass while waiting in line for the amusement park ride!

The Interim Approach

This preregistration undertaking is part of the interim approach introduced in March 2021 by the CSA and the Investment Industry Regulatory Organization of Canada (IIROC). It’s like a practice run for crypto platforms as they navigate the complex world of securities regulations. The CSA hopes to create a safer environment for all investors while allowing innovation in the crypto market.

Long Waits for Registration

It’s no secret that crypto trading platforms in Canada are in for a marathon, not a sprint, when it comes to obtaining full registration. The good news? Platforms can apply for a “restricted dealer” status to get started. However, even these restricted dealers must file the new preregistration undertaking to get their foot in the door.

Statements from the Industry

Crypto.com is already playing by the rules as it operates not just under the CSA but also with oversight from the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) and the Autorité des marchés financiers (AMF) in Quebec. CEO Kris Marszalek boldly stated, “The North American market, and Canada specifically, represent a significant area of potential growth for the crypto market.” While the excitement is palpable, regulators are not letting their guard down.

What’s Next for Crypto Platforms?

The CSA has made it clear: platforms that fail to file the necessary undertakings could face penalties. This warning serves as a reminder that in the world of crypto, compliance isn’t just a formality—it’s a survival strategy. The CSA is currently in discussions with other platforms about filing their undertakings, so the message is clear: play by the rules, or face the music.