Canada’s Ontario Regulator Bans Crypto Exchange Kucoin, Fines Bybit

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Canadian state regulator, the Ontario Securities Commission (OSC), has taken enforcement action against two cryptocurrency exchanges, Bybit and Kucoin, for not complying with local regulations.


Take Advantage of the Biggest Financial Event in London. This year we have expanded to new verticals in Online Trading, Fintech, Digital Assets, Blockchain, and Payments.

The OSC issued a warning on March 29, 2021, to the unauthorized crypto exchange in the state to contact the regulator or face enforcement action. However, both exchanges continued to operate in the Canadian state without approaching the regulator for a license.

Announced on Wednesday, the Canadian watchdog has slapped heavy fines on both platforms. Bybit Fintech Limited has disgorged almost US$2.5 million, along with another CA$10,000 as the regulatory investigation cost.

Seychelles-incorporated Mek Global and Singapore-incorporated PhoenixFin, both collectively operating the Kucoin brand, are facing permanent bans. In addition, they are facing an administrative penalty of CA$2 million and have to shell out a further CA$96,550 for the investigation cost.

Cooperation Pays

Bybit escaped the ban as the  exchange  responded to the enforcement action and cooperated with the regulatory investigation. The exchange even provided an undertaking for making its operations compliant with Canadian regulations.

Now, Bybit suspended the onboarding of new clients and the addition of new products for existing Ontario-based clients until the registration with the OSC is complete. And, the crypto exchange should wind up its Canadian operations if its registration discussion fails.

Moreover, Bybit will restrict access to certain products like contracts that involve  leverage 
Leverage

In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders need to rely on leverage to make financial trading viable. Generally, the higher the fluctuation of an instrument, the larger the potential leverage offered by brokers. The market which offers the most leverage is undoubtedly the foreign exchange market, since currency fluctuations are relatively tiny. Of course, traders can select their account leverage, which usually varies from 1:50 to 1:200 on most forex brokers, although many brokers now offer up to 1:500 leverage, meaning for every 1 unit of currency deposited by the trader, they can control up to 500 units of that same currency. For example, if a trader was to deposit $1000 into a forex broker offering 500:1 leverage, it would mean the trader could control up to five hundred times their initial outlay, i.e. half a million dollars. Likewise, if an investor using a 1:200 leveraged account, was trading with $2000, it means they would be actually controlling $400,000, i.e. borrowing an additional $398,000 from the broker. Assuming this investment rises to $402,000 and the trader closes their trade, it means they would have achieved a 100% ROI by pocketing $2000. With leverage, the potential for profit is clear to see. Likewise, it also gives rise to the possibility of losing a much greater amount of their capital, because, had the value of the asset turned against the trader, they could have lost their entire investment.FX Regulators Clamp Down on Leverage Offered by BrokersBack in multiple regulators including the United Kingdom’s Financial Conduct Authority (FCA) took material measures to protect retail clients trading rolling spot forex and contracts for difference (CFDs). The measures followed after years of discussion and the result of a study which showed the vast majority of retail brokerage clients were losing money. The regulations stipulated a leverage cap of 1:50 with newer clients being limited to 1:25 leverage.

In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders need to rely on leverage to make financial trading viable. Generally, the higher the fluctuation of an instrument, the larger the potential leverage offered by brokers. The market which offers the most leverage is undoubtedly the foreign exchange market, since currency fluctuations are relatively tiny. Of course, traders can select their account leverage, which usually varies from 1:50 to 1:200 on most forex brokers, although many brokers now offer up to 1:500 leverage, meaning for every 1 unit of currency deposited by the trader, they can control up to 500 units of that same currency. For example, if a trader was to deposit $1000 into a forex broker offering 500:1 leverage, it would mean the trader could control up to five hundred times their initial outlay, i.e. half a million dollars. Likewise, if an investor using a 1:200 leveraged account, was trading with $2000, it means they would be actually controlling $400,000, i.e. borrowing an additional $398,000 from the broker. Assuming this investment rises to $402,000 and the trader closes their trade, it means they would have achieved a 100% ROI by pocketing $2000. With leverage, the potential for profit is clear to see. Likewise, it also gives rise to the possibility of losing a much greater amount of their capital, because, had the value of the asset turned against the trader, they could have lost their entire investment.FX Regulators Clamp Down on Leverage Offered by BrokersBack in multiple regulators including the United Kingdom’s Financial Conduct Authority (FCA) took material measures to protect retail clients trading rolling spot forex and contracts for difference (CFDs). The measures followed after years of discussion and the result of a study which showed the vast majority of retail brokerage clients were losing money. The regulations stipulated a leverage cap of 1:50 with newer clients being limited to 1:25 leverage.
Read this Term, margin, or the extension of credit for Ontario clients. Additionally, it will liquidate their positions in these products.

“Foreign crypto asset trading platforms that want to operate in Ontario must play by the rules or face enforcement action,” said OSC’s Director of Enforcement, Jeff Kehoe. “The outcomes announced today should serve as a clear indication that we refuse to tolerate non-compliance with Ontario securities law.”

Earlier, the OSC took action against the crypto exchange, Poloniex for securities law breaches. Also, Binance, the largest crypto exchange in terms of trading volume, exited Ontario last year, citing mounting regulatory pressure.

Canadian state regulator, the Ontario Securities Commission (OSC), has taken enforcement action against two cryptocurrency exchanges, Bybit and Kucoin, for not complying with local regulations.

The OSC issued a warning on March 29, 2021, to the unauthorized crypto exchange in the state to contact the regulator or face enforcement action. However, both exchanges continued to operate in the Canadian state without approaching the regulator for a license.


Take Advantage of the Biggest Financial Event in London. This year we have expanded to new verticals in Online Trading, Fintech, Digital Assets, Blockchain, and Payments.

Announced on Wednesday, the Canadian watchdog has slapped heavy fines on both platforms. Bybit Fintech Limited has disgorged almost US$2.5 million, along with another CA$10,000 as the regulatory investigation cost.

Seychelles-incorporated Mek Global and Singapore-incorporated PhoenixFin, both collectively operating the Kucoin brand, are facing permanent bans. In addition, they are facing an administrative penalty of CA$2 million and have to shell out a further CA$96,550 for the investigation cost.

Cooperation Pays

Bybit escaped the ban as the  exchange  responded to the enforcement action and cooperated with the regulatory investigation. The exchange even provided an undertaking for making its operations compliant with Canadian regulations.

Now, Bybit suspended the onboarding of new clients and the addition of new products for existing Ontario-based clients until the registration with the OSC is complete. And, the crypto exchange should wind up its Canadian operations if its registration discussion fails.

Moreover, Bybit will restrict access to certain products like contracts that involve  leverage 
Leverage

In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders need to rely on leverage to make financial trading viable. Generally, the higher the fluctuation of an instrument, the larger the potential leverage offered by brokers. The market which offers the most leverage is undoubtedly the foreign exchange market, since currency fluctuations are relatively tiny. Of course, traders can select their account leverage, which usually varies from 1:50 to 1:200 on most forex brokers, although many brokers now offer up to 1:500 leverage, meaning for every 1 unit of currency deposited by the trader, they can control up to 500 units of that same currency. For example, if a trader was to deposit $1000 into a forex broker offering 500:1 leverage, it would mean the trader could control up to five hundred times their initial outlay, i.e. half a million dollars. Likewise, if an investor using a 1:200 leveraged account, was trading with $2000, it means they would be actually controlling $400,000, i.e. borrowing an additional $398,000 from the broker. Assuming this investment rises to $402,000 and the trader closes their trade, it means they would have achieved a 100% ROI by pocketing $2000. With leverage, the potential for profit is clear to see. Likewise, it also gives rise to the possibility of losing a much greater amount of their capital, because, had the value of the asset turned against the trader, they could have lost their entire investment.FX Regulators Clamp Down on Leverage Offered by BrokersBack in multiple regulators including the United Kingdom’s Financial Conduct Authority (FCA) took material measures to protect retail clients trading rolling spot forex and contracts for difference (CFDs). The measures followed after years of discussion and the result of a study which showed the vast majority of retail brokerage clients were losing money. The regulations stipulated a leverage cap of 1:50 with newer clients being limited to 1:25 leverage.

In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders need to rely on leverage to make financial trading viable. Generally, the higher the fluctuation of an instrument, the larger the potential leverage offered by brokers. The market which offers the most leverage is undoubtedly the foreign exchange market, since currency fluctuations are relatively tiny. Of course, traders can select their account leverage, which usually varies from 1:50 to 1:200 on most forex brokers, although many brokers now offer up to 1:500 leverage, meaning for every 1 unit of currency deposited by the trader, they can control up to 500 units of that same currency. For example, if a trader was to deposit $1000 into a forex broker offering 500:1 leverage, it would mean the trader could control up to five hundred times their initial outlay, i.e. half a million dollars. Likewise, if an investor using a 1:200 leveraged account, was trading with $2000, it means they would be actually controlling $400,000, i.e. borrowing an additional $398,000 from the broker. Assuming this investment rises to $402,000 and the trader closes their trade, it means they would have achieved a 100% ROI by pocketing $2000. With leverage, the potential for profit is clear to see. Likewise, it also gives rise to the possibility of losing a much greater amount of their capital, because, had the value of the asset turned against the trader, they could have lost their entire investment.FX Regulators Clamp Down on Leverage Offered by BrokersBack in multiple regulators including the United Kingdom’s Financial Conduct Authority (FCA) took material measures to protect retail clients trading rolling spot forex and contracts for difference (CFDs). The measures followed after years of discussion and the result of a study which showed the vast majority of retail brokerage clients were losing money. The regulations stipulated a leverage cap of 1:50 with newer clients being limited to 1:25 leverage.
Read this Term, margin, or the extension of credit for Ontario clients. Additionally, it will liquidate their positions in these products.

“Foreign crypto asset trading platforms that want to operate in Ontario must play by the rules or face enforcement action,” said OSC’s Director of Enforcement, Jeff Kehoe. “The outcomes announced today should serve as a clear indication that we refuse to tolerate non-compliance with Ontario securities law.”

Earlier, the OSC took action against the crypto exchange, Poloniex for securities law breaches. Also, Binance, the largest crypto exchange in terms of trading volume, exited Ontario last year, citing mounting regulatory pressure.

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