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In a significant development affecting Canadian users, Binance, the world's leading cryptocurrency exchange by trading volume, has declared that it will cease operations in the country.
A Surprise Exit
The exit came as a surprise to users and was announced in a tweet on Binance’s official Twitter handle. The exchange blamed new regulatory guidance as the primary reason to quit the Canadian Market. According to Binance, Canada passed recent rules related to stablecoins and investor limits for cryptocurrency operations. This, according to Binance, made it unviable to continue operations in the country. The exchange announced,
“Unfortunately, today we are announcing that Binance will be joining other prominent crypto businesses in proactively withdrawing from the Canadian marketplace.”
The exchange also thanked regulators that it worked with and added that the Canadian market held significant sentimental value for the exchange, given that it was its founder’s home country. Binance added,
“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.”
Binance added that the exchange had high hopes from the Canadian crypto and blockchain industry. It also added that it put off the decision to shutter its Canadian operations for as long as possible while trying to find other avenues to continue operations.
“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 Canadian 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.”
Major Crypto Players Retreating
Binance’s abrupt departure from the Canadian crypto space is in line with a recent trend of crypto firms shutting operations in jurisdictions that feature unfavorable regulatory frameworks. In its statement, Binance stated that its Canadian user base would receive details via email on how the withdrawal would impact their accounts. It also added that it hopes to engage further with Canadian regulators and create a more comprehensive and thoughtful regulatory framework.
The exchange also stated that it is optimistic about the future of the Canadian market and hoped to make a return sooner rather than later.
“We are confident that we will someday return to the market when Canadian users will once again have the freedom to access a broader suite of digital assets.”
Canada has seen several other cryptocurrency exchanges shutter or limit their operations in the country. Most have cited an unfavorable regulatory climate as the reason for their departure. In April, dYdX announced that its decentralized derivatives exchange would no longer be available to its Canadian users. dYdX announced that it would be ending trading support for its customers on the 14th of April. 2023. OKX has also announced that it plans to shut down its Canadian operations by the middle of 2023. Unsurprisingly the exchange cited an unfavorable regulatory climate as the reason behind its move.
On the other hand, Kraken has committed itself to regulation in Canada. The exchange signed a pre-registration undertaking (PRU) with the Ontario Securities Commission. The decision by Kraken underlined its commitment to stringent investor protection rules, which were amended in February.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.