Binance Exchange has revealed in a recent report that it has suspended operations in its branch in Canada, with immediate effect. The giant exchange explains that it is having issues with the strict crypto rules enforced in the country.
According to the report, Binance, the largest crypto exchange globally, announced its decision to depart the Canadian market on Friday. Henceforth, the exchange would cease to offer any services to its customers in the country’s territory.
Explaining further, Binance blamed its decision on the extreme regulatory measure of the country. It added that the country’s market is no longer tenable due to the harsh rules.
Regulations In Canada Are Not Crypto-Friendly
Amidst the stringent crypto regulations prevailing in Canada, the giant crypto exchange exits the Canadian market. However, the exchange stated it was to hold a dialogue with the country’s regulators, seeking redress.
During the announcement, a Binance spokesperson said the firm is confident and ready to reenter the Canadian market anytime a business-friendly regulatory framework is in place.
According to the report, the Canadian Securities Administrators (CSA) recently issued the concerned regulations in February. The rules were reportedly set in place by the regulator to protect crypto investors from the fraudulent activities that rampaged the crypto ecosystem in 2022.
In addition, the regulations majorly target offshore crypto firms that offer crypto-related services to Canadians, such as Binance. Apart from forming the rules, the CSA also played other crucial roles.
For instance, the regulatory body mandated crypto firms to separate digital currencies held for local users. In addition, the agency recently placed a ban on margin trading and other leverage trading forms. It also bans the sale of stablecoins without the regulator’s approval.
Binance Embittered Over Canadian Market Exit
Via its official Twitter page, Binance claimed that the new rules enforced in the country, particularly the restriction on selling Stablecoin, placed the exchange under a heavy burden. It stated that its Canadian users would be emailed about how the latest development would affect their accounts.
Additionally, Binance expresses how displeased and difficult it is to exit the Canadian market. Explaining further, Binance said although the Canadian market marks a fraction of its global markets, it holds a very special place in their hearts.
This is because Binance CEO and founder Changpeng Zhao emigrated to Canada at a tender age and claimed Canadian citizenship. Hence, exiting its founder’s home country is quite difficult, according to Binance.
Before Binance announced the sudden exit, the exchange had already agreed with the Securities Commission of Ontario to stop registering new Canadian investors on its platform. The agreement mandated Binance to control and stop any trading activities emanating from any region in Ontario or ordered by users based in Ontario.
While Binance seemed to be on the back foot in Canada, it is frantically putting all effort into preserving its business and thriving amidst the regulation catastrophe prevailing in the US. In addition, the Binance stakeholders reportedly planned to minimize Zhao’s majority stake, considering him being subjected to many regulators’ scrutiny lately.
Furthermore, the leadership board at Binance recently discussed the way out of the current lawsuit filed against Zhao and Binance by the Commodity Futures Trading Commission. The panel believed that restructuring the exchange’s ownership would help reduce the regulators’ focus on it.
