Key Takeaways:
- Bitcoin, Litcoin, Bitcoin Cash, Litecoin, and Ethereum are excluded from the buy limits.
- Net Buy limit will not impact you if the person lives in Alberta, Manitoba, British Columbia, and Quebec.
- Bitbuy and Newton crypto exchange imposed similar restrictions.
Canada-based crypto exchange Newton is imposing a $30,000 CAD annual “buy limit” on all cryptocurrencies except Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.
The net buy limits will apply to people who live in New Brunswick, Newfoundland, Nova Scotia, Nunavut, Northwest Territories, Ontario, Prince Edward Island, Saskatchewan, and Yukon.
The annual buy limits come amidst the Toronto-based crypto exchange announcing that it has officially registered as a “restricted dealer” in the province of Ontario, which means that they’re now subject to the regulations set out by the Ontario Securities Commission (OSC).
“These changes are to protect crypto investors, like yourself, and to make sure investors are aware of the risks associated with investing in crypto assets”, the exchange’s statement reads.
Newton added that if a trader bought and sold a restricted coin, the sell amount would be subtracted from the limit. The limit resets every 12 months from the first purchase of restricted coins.
Apart from the net buy limits, the other significant changes involve seeking information about traders’ past experience and knowledge with crypto investing their financial situation, and their risk tolerance using a trading questionnaire.
“You can expect to see this questionnaire when accessing your Newton account over the coming days. This must be completed to continue funding your account and trading”, Newton’s official announcement reads.
Following filling out the questionnaire, Newton added that the user would receive a notification from Newton if the user’s portfolio approaches the loss level they have indicated that they are comfortable with in their questionnaire.
The latest change is more notable since the Ontario province alone accounts for nearly 40% of the Canadian population.
Newton is not the only Canadian Exchange to set a net buy limit. Earlier this year, Bitbuy, one of Canada’s leading crypto exchanges, also implemented a similar trading limit rule.
Canadian regulatory authorities are now increasingly getting concerned about consumer protection. Earlier this month, OSC put out a filing that included the investment limits.
The Canadian Federal Government is also looking into its financial sector legislation to enhance the security and stability of digital currencies.
