As the cryptocurrency sector continues to broaden, governments around the world are turning their attention to it. Several countries have implemented stricter regulations for crypto firms to protect customers and protect against money laundering and other criminal activities. As a result, numerous crypto companies have agreed to adhere to these stringent regulations in order to remain in the market. Recently, Kraken, a leading crypto exchange, has promised the Canadian crypto community to comply with the country’s crypto regulations.
Kraken Submits a Pre-Registration
Kraken, a US-based cryptocurrency exchange, has chosen to remain operational in Canada and is willing to abide by the stricter rules enforced by the nation’s financial regulator, the Canadian Securities Administrators (CSA).
Kraken has revealed that it has submitted a pre-registration undertaking to the Ontario Securities Commission in its attempt to become a licensed Restricted Dealer across the nation, thereby exhibiting its commitment to abiding by the Canadian Securities Administrators’ refreshed investor protection directives.
David Ripley, Kraken’s chief operating officer, stated:
“Canada as a region is critical to our mission to empower people with new ways to connect and transact.”
In light of Canada’s tighter regulations on crypto exchanges, a deadline has been set for accepting a range of strengthened pre-registration undertakings (PRUs), resulting in the departure of some major players such as OKX, Deribit, and Blockchain.com from the market. Nonetheless, other firms have chosen to stay despite the new regulations.
Kraken Agrees to Follow Regulations
In response to the Securities and Exchange Commission (SEC) accusing it of selling unregistered securities, crypto exchange Kraken has concluded a settlement and has consented to end staking activities involving retail investors in February. Kraken has also paid a fine of $30 million as part of the agreement.
Kraken’s decision and the SEC’s ruling have sparked discontent in the cryptocurrency community and have been criticized by both investors and lawmakers. Kraken’s Chief Legal Officer has also communicated the exchange’s plans to implement its ban.
Kraken has been serving Canadian customers for over a decade and currently has a workforce of more than 250 people in Canada. The exchange has been approved as a money services business in Canada by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) since 2019.
Mark Greenberg, Kraken’s managing director for Canada, said:
“We want both existing and prospective customers to know Kraken is committed to Canada. As we forge this new regulatory path, we will continue to engage with our local regulators to improve understanding of crypto’s economic benefits and transformative potential.”
On February 22, Canada unveiled a new regulatory framework that requires the segregation of assets held in custody and enforces more stringent regulations on re-hypothecation, margin trading, and certain transactions involving proprietary tokens or stablecoins.
To sum up, Kraken’s agreement to meet Canada’s more stringent crypto rules is a significant step toward improving the legitimacy and credibility of the crypto market. This is a positive development that will help to secure investors and preserve market stability. As cryptocurrencies become increasingly popular, it is essential that industry players collaborate with regulators to create a safe and secure crypto environment.