Gemini Exits Canada Amid Stricter Crypto Regulations

Crypto exchange Gemini has announced its departure from the Canadian market, joining other major platforms like Binance and OKX in exiting the country. The decision comes in response to new stringent regulations imposed by the Canadian Securities Administrators (CSA) earlier this year.

Regulatory Changes Prompt Departure

In February 2023, the CSA introduced a series of new restrictions on crypto exchanges. These regulations enforce stricter standards on the custody of funds, limit the provision of leverage, and require exchanges to submit daily financial data. Additionally, exchanges must obtain explicit permission to offer stablecoins to customers.

Gemini, founded and operated by the Winklevoss twins, will close all Canadian accounts on December 31. The exchange has urged users to withdraw their cash and cryptocurrencies before the deadline. While Gemini did not specify the reasons for its exit, the move aligns with other major exchanges citing regulatory challenges in Canada.

Other Major Exchanges Also Exit

Binance announced its exit from the Canadian market in May 2023, stating that the new regulatory guidance made operating in the country untenable. “New guidance related to stablecoins and investor limits provided to crypto exchanges makes the Canada market no longer tenable for Binance,” the company said.

Similarly, OKX left Canada in March 2023, instructing users to withdraw their assets by June 2023. Stablecoin issuer Paxos and crypto exchange Bybit also ceased operations in Canada in response to the new regulations.

Canada’s Firm Regulatory Stance

Canada has demonstrated a strict approach toward crypto regulation. The CSA’s tightened rules aim to protect consumers, especially in light of high-profile insolvencies like FTX, BlockFi, Voyager, and Genesis during the 2022 crypto winter.

The country has not hesitated to enforce compliance; exchanges like KuCoin and Poloniex were banned in 2022 for failing to meet Canadian securities law requirements outlined by the Ontario Securities Commission (OSC).

Remaining Options for Canadian Users

Despite the departure of several major exchanges, Canadians still have access to platforms such as Kraken, Coinbase, and Bitget. These exchanges continue to operate under the new regulatory framework set by the CSA.

Extended Deadline for Compliance

Recognizing the challenges faced by crypto firms, the CSA recently extended the deadline for exchanges to comply with the new regulations until the end of 2024, pushing it back from the original date in October. This extension is intended to give companies more time to meet the stringent requirements.