- The Canadian Securities Administration (CSA) released a notice requiring crypto exchanges that plan to operate nationwide to pre-register within 30 days.
- This process includes segregating crypto assets held on behalf of Canadian clients, suspending margin and leverage trading, and ceasing the sale of stablecoins without permission.
- The CSA also warned Canadians about the risks associated with trading crypto assets.
Canada Requires Crypto Exchanges to Pre-Register
The Canadian Securities Administration (CSA) released a notice on Feb.22 requiring crypto exchanges that plan to operate nationwide to undergo a pre-registration process within 30 days. This process includes segregating crypto assets held on behalf of Canadian clients and suspending offering margin, credit, or other forms of leverage trading to Canadian users. In addition, exchanges must cease selling stablecoins until written consent is secured from the CSA.
Objectives Behind Pre-Registration Process
CSA chair Stan Magidson stated that this decision was made in order to reduce the risk associated with trading crypto assets, particularly when conducted on unregistered platforms based outside of Canada. The recent insolvencies involving several crypto asset trading platforms highlighted these risks and prompted the CSA’s action.
Warning for Investors
The CSA also reminded Canadians that crypto trading came with an „elevated“ level of risk, which may not be suitable for many investors. Therefore it is important for investors to understand these risks before investing their funds in cryptocurrencies.