Arguably the world’s biggest cryptocurrency exchange, Binance, is in the news today after it advised its users in Ontario, Canada to “close out all active positions” by the end of this year. As per the official announcement released by Binance,
“Binance has updated its Terms of Use to provide that Ontario (Canada) has become a restricted jurisdiction, effective 2021-06-26 at 3:59:59 AM (UTC). Regrettably, Binance can no longer continue to service Ontario-based users.”
Here, it’s worth pointing out that the aforementioned development came on the heels of the news that Japan’s Financial Services Agency (FSA) issued a warning to Binance for operating in the country without permission. A similar warning was issued by the Japanese FSA against Binance in March 2018.
Last year, the Malta Financial Services Authority had announced that Binance was “not authorized to operate in the cryptocurrency sphere” in Malta.
Taking a deeper look at the regulatory issues that the world’s largest cryptocurrency exchange has dealt with in the past, it may be relevant to revisit the incorporation of Binance.US. The same was formed separately after Binance was banned in the U.S to ensure better compliance with all the applicable U.S laws. This, however, did not stop the Commodity Futures Trading Commission (CFTC) in the US from initiating an investigation against Binance Holdings for allowing Americans to “make bets that violated U.S. rules.”
Over the last couple of months, operations of other cryptocurrency exchanges in Canada, including Kucoin and Poloniex, have also been affected. In both cases, actions were instituted against these exchanges by the Ontario Securities Commission citing “disregard/defiance of the Ontario securities laws.”
With respect to Binance, however, the aforementioned announcement titled “Terms of Use Review (2021-06-25)” did not give any further details in relation to closing its operations in Ontario.
In absence of sufficient information regarding the end of Binance’s stint in Ontario, there may or may not be room for speculation as to the reasons. However, it is clear that the world’s largest cryptocurrency exchange by volume may still have some ground to cover on the regulatory front.
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