Crypto.com secures preliminary approval to operate in Canada

To continue operating while their application is being processed, cryptocurrency platforms must give their primary regulator a pre-registration undertaking. By making these commitments, Crypto.com acknowledges that its platform is bound by terms and conditions that address investor protection issues.

If a cryptocurrency trading platform is unable to file an undertaking or does not adhere to its requirements, CSA members may seek legal action.

“Compliance underscores everything that we do at Crypto.com. The North American market, and Canada specifically, represent a significant area of potential growth for the crypto market, and we are proud to work with the OSC and the CSA in providing Canadian customers access to a safe, secure, and reliable global platform,” said Kris Marszalek, CEO of Crypto.com.

Earlier this year, Crypto.com has integrated with Canadian e-commerce giant Shopify so global merchants can accept crypto payments and save on processing fees through cash-final settlements.

The integration aims to make things easier for Shopify’s almost two million merchants to expand their reach by making their products more accessible for customers who pay with crypto. Crypto.com Pay also offers an alternative to traditional card networks such as Visa and MasterCard.

The new registration comes amid a nation-wide crackdown on unregulated exchanges. Binance, the world’s largest cryptocurrency exchange, informed a Canadian provincial regulator in March that it would no longer be accepting new customers. The industry’s giant seemingly opted to pull out of Ontario, rather than comply with securities law or face regulatory scrutiny.

Ontario’s securities watchdog also said Binance has provided an “undertaking” to cease trading for existing Ontario-based accounts. Facing the threat of regulatory sanctions, the exchange updated its terms of use, declaring Ontario a “restricted jurisdiction.” As a result, Binance has blocked services in Canada’s most populous province and asked Ontarians to take immediate measures to close out their trading positions.

The OSC statement went on to warn that it reached out to other crypto-asset trading platforms to initiate the registration process, or face enforcement action, including temporary orders.

The move follows the Ontario Securities Commission’s onslaught on Binance back in December 2021 for their alleged failure to comply with securities law. At the time, OSC said Binance has broken its word to regulators after it had previously told its staff that no new transactions involving Ontario residents would occur.

In the weeks leading up to Binance’s departure, the exchange rescinded that commitment, claiming that its authorization as a money services business allows it to continue operating in the province. A spokesperson for Binance described the latest trouble with the OSC as a “miscommunication” and that it is looking to remedy the misunderstanding.