Crypto Exchange Bybit Exits Canada Amid Tightened Regulations

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Key takeaways:

  • While looking towards expanding into new areas like Kazakhstan, Bybit intends to depart Canada.
  • After May 31, no new account openings will be permitted; however, current clients will have until July 31 to make new deposits and sign new agreements.

Following significant changes in the regulatory sector, cryptocurrency exchange Bybit has stated it will pause providing products and services to residents and nationalities of Canada.

Bybit announced in a blog post on May 30 that starting on May 31, the company will not accept applications for new accounts from Canadians. Before these services are phased out, and other assets are liquidated after September 30, current cryptocurrency exchange users have until July 31 to make deposits and “increase any of their existing positions.”

Aside from the “recent regulatory development” that Bybit has been experiencing in Canada, the company could not provide any other reason for leaving the market. Bybit stated that it intended to impose obligatory Know Your Customer rules for all customers starting in May 2023 after the Ontario Securities Commission (OSC) assessed punitive penalties on the exchange in June 2022. Bybit stated in the blog post:

“As the adoption of crypto continues to grow, our mission is to provide safer and sustainable trading experience to all crypto enthusiasts while maintaining necessary safeguards.” 

The most recent cryptocurrency company to announce its intention to leave Canada due to laws was Bybit. Decentralized exchange dYdX said in April that it would “wind down” its services for Canadian consumers due to the “regulatory climate” in that nation.

Binance, a significant cryptocurrency exchange, announced in May that it was “proactively withdrawing” from Canada, citing Canadian Securities Administrators regulations. As a result of regulatory uncertainty, a fintech company called Paxos has also announced its intention to leave Canada.

On the other hand, in April, the cryptocurrency exchange Gemini provided a pre-registration undertaking to the OSC, which oversees the capital markets in the province with the most population in Canada.

The Astana Financial Services Authority of Kazakhstan granted preliminary approval to Bybit last week, allowing it to operate as a provider of custody services at the Astana International Financial Centre and a trading facility for digital assets. Bybit has received “in-principle” permission, which is subject to prerequisites and will result in permanent authorization to provide locals with services after the application process is fully completed.

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