Bitfinex asks Ontario-based customers to close their accounts by Mar 1

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TL;DR Breakdown

  • The Ontario Securities Commission(OSC) has begun a crypto crackdown on exchanges, forcing some to cease giving their services.
  • The commission has cracked down on exchanges like Bitfinex, Binance, KuCoin, and Okex.

Ontario has begun a crypto crackdown on exchanges operating there. As a result, Bitfinex has advised its Ontario-based clients to close their trading accounts by the last day of February. The exchange plans to distance itself from Ontario as crypto regulations tighten there.

Bitfinex to stop serving Ontario-based clients by March

On Friday, Bitfinex announced that it would be closing trading accounts of customers from Ontario. It also communicated that no new market positions are going to be opened by Ontario clients. The ones with active positions must also close them by the end of February. The exchange is following these steps to distance it from the strict regulations in Ontario.

The exchange advised that all citizens from the Ontario province of Canada will no longer have crypto services starting Mar 1. Therefore they should withdraw all funds to prevent any inconveniences that may follow the exchange’s new resolutions.

However, the exchange never mentioned OSC as the reason behind their plan to stop offering crypto services in Ontario. But reports are out that the commission is bracing itself to ‘effectively’ deal with crypto exchanges operating there.

Last month, the OSC warned that Binance does not have legal rights to operate in Ontario. It said that the exchange is not permitted to offer any futures, derivatives, and securities to any Ontario Parties after Binance had announced these services. However, Binance issued a counter-statement explaining a miscommunication on the legality of their operation in Ontario.

Crypto regulation continues as exchanges prepare for a ‘transparent’ era

Regulators have been dawning on crypto exchanges to deal with possible crypto conspiracies and misuses. In particular, Bitfinex has been in the limelight for a long. It has been a victim of close look by the US and even serving a fine from CFTC. The CFTC fined Bitfinex for conducting crypto trades off the books with US citizens.

The company was charged in conjunction with Tether, its close business partner, for a fine amounting to $42.5 M. The office of the New York Attorney General also asked the companies to pay $18.5M for damages. They were also required to submit periodic reports on their reserves.

The regulators from Ontario are not the first ones to question crypto exchanges. Last month, Binance announced that it would stop offering crypto services to Singaporeans following tight regulations by the local authorities. Singapore had communicated earlier that Binance does not meet the set standards to provide crypto services there. The exchange has until Feb 12, 2021, to cease offering crypto services there.

Later on Christmas day, Binance was slapped with a fine by Turkey. The local authorities in the country conducted liability inspections on Binance’s local branch and found issues. The exchange asked to pay 8 million Lira or 751 314 USD. The exchange did not state the fine.

These developments push crypto exchanges to cooperate with regulators to improve their operations. However, it is good to keep an eye on steps taken by exchanges to comply with regulations before opening any trading accounts.