Canadian Regulator Takes Action against Crypto Trading Platforms
Two cryptocurrency trading platforms in Canada are in trouble with the Ontario Securities Commission (OSC). A complete ban has been imposed on KuCoin, which means that it can no longer operate in the capital markets of Ontario. As far as Bybit is concerned, the platform has agreed to comply with the rules set forth by the OSC and to register itself with the regulatory authority.
2 Crypto Trading Platforms Sanctioned
On Wednesday, the Ontario Securities Commission (OSC) announced the outcome of the actions that it had taken against two of the crypto trading platforms that were operating in its jurisdiction. The first crypto trading platform is Bybit, which is based in the British Virgin Islands, and was founded by Bybit Fintech Ltd.
Mek Global Ltd and Phoenixfin Pte. Ltd. own and operating Kucoin, which is the other foreign crypto trading platform sanctioned by the OSC. The companies are operating from the Republic of Seychelles and Singapore. The Canadian regulator said that both of the crypto asset trading platforms are unregistered. This means that they have not given a prospectus to Ontario investors, or informed them about exemptions, when it comes to trading securities.
The OSC said that they had been able to ban Kucoin successfully, which means that the platform will no longer be able to participate in the capital markets in Ontario. Moreover, they have also imposed a penalty on KuCoin, which is around CAD $2,000,000.
Other than this fine, the platform will also be required to pay a sum of CAD $96,550.35 ($74,497) to the OSC because of the costs that it incurred in the investigation.
Bybit Comes to a Settlement
The same approach was not taken in the case of Bybit because the crypto trading platform decided to go for a settlement with the OSC. The Canadian regulatory authority stated that as opposed to KuCoin, Bybit responded to their enforcement action and had decided to establish an open dialogue. It added that the platform had also provided all the necessary information and was ready to engage in discussions about registration.
The securities watchdog in Canada added that Bybit had paid a penalty worth CAD $2,468,910 to the OSC and had also paid another CAD $10,000 for the cost of the investigation. The regulator said that the platform had given an undertaking, which means that they can hold it accountable and it will take the proper steps for becoming compliant.
In addition, existing retail investors in Ontario will also have to wind up their positions in some restricted products. The OSC had made an announcement last year in March, which said that crypto trading platforms operating in the country had to begin discussions for registration with the regulator by April 19th if they were offering securities or derivatives trading. Otherwise, they would be subject to enforcement action.
According to the regulator, the two platforms had not gotten in touch with the OSC by the given deadline and had continued to offer their services in Ontario.