Canadian Crypto Trading Platforms Face 'Enhanced' Rules Under New Regulations

They have 30 days to comply.

AccessTimeIconFeb 22, 2023 at 5:34 p.m. UTC
Updated Feb 22, 2023 at 5:45 p.m. UTC

The Canadian Securities Administrators published new guidance for the local crypto industry Wednesday, warning exchanges and other platforms they would have to abide by "enhanced investor protection commitments."

According to a press release, companies hoping to operate in Canada would have to make these commitments through a pre-registration process while working on their actual registrations. They have 30 days to comply. In this pre-registration process, exchanges and other companies will have to abide by custody rules, which discuss segregating crypto assets held for local clients, a ban on margin or other forms of leverage and a ban on selling stablecoins without the CSA's permission.

In a statement, CSA Chair Stan Magidson, who also runs the Alberta Securities Commission, said, "Recent insolvencies involving several crypto asset trading platforms highlight the tremendous risks associated with trading crypto assets, particularly when conducted on unregistered platforms based outside of Canada."

According to the notice, unregistered crypto trading platforms now have 30 days to publish a revised pre-registration undertaking, which may end up posted on the CSA's website. Companies that cannot or will not comply are "expected" to offload Canadian users and block the jurisdiction.

"Specifically, the enhanced PRU will include additional commitments from the CTP to hold assets, including cash, securities and crypto assets that are not securities, of a Canadian client ... In the case of crypto assets, in a designated trust account or in an account designated for the benefit of clients with a custodian that comes within the definition of 'Acceptable Third-party Custodian,'" the notice said.

Third-party custodians can be Canadian or foreign companies, according to the document, but require a SOC 2 type 1 or 2 report within the last year.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

CoinDesk - Unknown

Nikhilesh De is CoinDesk's managing editor for global policy and regulation. He owns marginal amounts of bitcoin and ether.

Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.