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The decision coincides with the announcement of stricter crypto regulation by the Canadian Securities Administrators (CSA).
As crypto regulation broadens in Canada, blockchain infrastructure platform Paxos has announced plans to shut down its operations in Canada.
In a statement published on the company website, the firm advised its Canadian customers to begin withdrawing any funds from their accounts. “Beginning June 2nd, you will no longer be able to transact from your Paxos account,” it stated.
Paxos customers with no funds in their accounts will be automatically phased out by May 9. Others who retain funds in their accounts will still be able to transact from their accounts till June 2. After that, though all remaining funds will still be available for withdrawal, owners will be unable to initiate new transactions on the platform.
Further, Paxos stated that customers could either transfer their digital assets to external wallets or transfer their fiat to bank accounts linked to their “itBit account”.
New Crypto Regulation Responsible for Withdrawal
Interestingly, Paxos did not categorically state any reason for its withdrawal from the Canadian market. However, the decision coincides with the announcement of stricter crypto regulation by the Canadian Securities Administrators (CSA).
The CSA mandates crypto exchanges to enter into legally binding contracts with it even while awaiting registration with the regulatory body. Also, the CSA announced upgrades to its policy for crypto asset trading platforms, effectively limiting the trading of stablecoins. The regulation also touched base on assets separation, leverage, capital determination, transparency, etc.
Since then, several exchanges have closed shop within the country. OKX ceased its operations in the country on March 24, citing the new crypto regulation. Also, dYdX halted new user onboarding from April 7. The firm plans to close all existing customers to withdraw-only mode from April 14.
Meanwhile, some exchanges like Gemini and Coinbase have announced that they will remain active in Canada. Coinbase communications director Elliott Suthers said:
“We remain as committed as ever to the Canadian market as a core component of our international road map.”
On its part, Binance remains non-committal about its plans for the country. As for Paxos, the firm plans to “assess its readiness to re-enter the Canadian market in cooperation with the Ontario Securities Commission” in the future.