Coinbase, one of the leading cryptocurrency exchanges in the United States, has made a bold move in the midst of a domestic regulatory crackdown by expanding its operations to Canada. The company recently announced that it has obtained restricted dealer licenses in the country, marking a significant milestone in its global expansion efforts.
With the issuance of this new permit, Coinbase has been formally recognized as a legitimate cryptocurrency business in Canada. The company went through a rigorous process to secure the license, including signing an Enhanced Pre-Registration Undertaking in March 2023 to demonstrate its commitment to regulatory compliance and operational excellence.
According to the Canadian Securities Administrators (CSA), Coinbase is now registered as a restricted dealer under Ontario’s regulatory framework. This type of registration is reserved for businesses that do not fit into any other category, and regulators have set specific standards for these types of dealers.
Coinbase’s expansion into Canada comes at a time when other cryptocurrency exchanges, such as Kraken, are also seeking restricted dealer status in the country. Kraken submitted a pre-registration commitment to the Ontario Securities Commission in March 2023 in order to comply with new regulations set by the CSA for platforms that trade digital assets.
The new regulations require local cryptocurrency trading platforms to adhere to stronger custody guidelines, limitations on leverage, and a prohibition on trading stablecoins without prior approval from the CSA. By obtaining a restricted dealer license in Canada, Coinbase is positioning itself to comply with these regulations and continue to operate in a compliant manner.
In addition to obtaining the new license, Coinbase has also made significant moves in Canada, including forming a joint venture with the regional financial services company, Peoples Trust Company, to extend its services to Canadian citizens. The company has announced plans to employ around 200 locals full-time in Canada, operating out of a tech cluster in the country.
Overall, Coinbase’s expansion into Canada represents a strategic move to diversify its operations and establish a strong presence in the global cryptocurrency market. With regulatory scrutiny increasing in the United States, the company’s expansion into Canada demonstrates its commitment to compliance and growth in new markets.
