#Canadian Regulators Set New Rules for Unregistered Crypto Platforms

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In Brief

Canadian authorities have strengthened their oversight over crypto trading platforms.

Crypto trading platforms pursuing registration will have to undergo ‘enhanced pre-registration’ within 30 days.

Canada recently ordered that crypto trading platforms not offer or allow deposits of stablecoins.

Canadian regulators have ordered that crypto trading platforms go through enhanced pre-registration in their pursuit to register. The changes include a prohibition on offering margin, credit, or other forms of leverage.

Authorities in Canada are making moves with respect to crypto regulations. The Ontario Securities Commission has published a notice stating that it had strengthened oversight of crypto trading platforms in the country.

The notice describes “investor protection commitments it expects from crypto asset trading platforms (CTPs) operating in Canada.” It specifically refers to the multiple bankruptcies that have taken place over the past 12 months. These include the likes of FTX and Voyager Digital, which have also made headlines in mainstream media.

As such, the authorities in Canada want to impose checks and balances to ensure that such incidents do not occur again. Crypto trading platforms pursuing registration will have to provide “enhanced pre-registration” within 30 days of February 2022, when the notice was published.

The enhanced pre-registration requirements include information about the custody and segregation of crypto assets held on behalf of Canadian clients. Perhaps more importantly, it prohibits offering Canadians margin, credit, or any other form of leverage.

Stablecoins are also a part of the new rules. Crypto trading platforms will not be able to allow the purchase or deposit of stablecoins without written consent. This includes proprietary tokens as well.

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