Canada Extends Deadline for Crypto Exchanges' Stablecoin Compliance

In Brief:

The Canadian Securities Administrators (CSA) extended the deadline for crypto trading platforms to comply with new stablecoin regulations to December 31, 2024, due to technical challenges faced by exchanges.

Some exchanges exited Canada in response to the regulations, while others, like Kraken, are working to comply and attain restricted dealer status.

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Canada Extends Deadline for Crypto Exchanges' Stablecoin Compliance

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The Canadian Securities Administrators (CSA) have announced an extension for crypto trading platforms to comply with new stablecoin regulations, moving the deadline to December 31, 2024. This marks the second delay in enforcing the rules, initially introduced in February 2023, which restrict value-referenced crypto assets (VRCAs) that are not backed by a single fiat currency.

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The CSA's decision comes after crypto platforms reported technical difficulties in meeting the original April 30 deadline, which was first pushed back to October 31. The CSA emphasized its openness to alternative mechanisms that address investor protection concerns and has actively engaged with crypto trading platforms and industry participants.

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Impact on Crypto Exchanges in Canada

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The new regulations have prompted several overseas exchanges, including OKX, dYdX, Paxos, Bybit, and Binance, to cease operations in Canada between March and May 2023. However, some exchanges, like Kraken, are committed to remaining in the Canadian market and are working towards attaining restricted dealer status. Kraken's managing director for Canada, Mark Greenberg, praised the collaborative nature of Canadian regulators, highlighting a clear regulatory pathway that facilitates investment in the country.

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Gemini has also taken steps to comply by filing a pre-registration undertaking in April 2023, marking the initial move towards becoming a restricted dealer under Canadian regulations.

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