Canadian Watchdog Alleges Crypto Exchange of Breaking Securities Law

Poloniex – a multinational crypto exchange – caught the eye of Canadian securities regulators. The watchdog launched actions against it under the accusations of not complying with Ontario rules.

Against The Law

In a recent statement, the Ontario Securities Commission (OSC) accused the cryptocurrency exchange platform Polo Digital Assets – better known as Poloniex – of not adhering to Canadian laws. According to the document, the trading venue failed to sign up with the agency while promoting it to locals to use its platform and trade digital assets on it:

Poloniex has never filed a prospectus with the Commission or obtained an exemption from the prospectus requirement.”

The OSC noted that the Republic of Seychelles assisted the Canadian authorities since the exchange is registered on the island.

The new move comes nearly two months after the OSC pushed crypto trading venues in Ontario to abide by local security laws to avoid facing potential sanctions. Additionally, the watchdog reminded that more than 70 platforms have complied with the regulations, with Poloniex not being one of them:

”Despite this warning, Poloniex did not contact the Commission by April 19, 2021, or at any time to start compliance discussions.”

Despite all the accusations, Poloniex remained silent and will wait to speak in court on June 18th. According to the statement, the trading venue will have to pay an administrative penalty of up to 1 million of the local currency or $830,000. The OSC will also demand it to stop providing its services to Canadian citizens.

OSC Greenlighted a Bitcoin ETF

As CryptoPotato reported in February, it approved an application from the financial services company Purpose Investments Inc. to launch a bitcoin exchange-traded fund in several Canadian territories such as British Columbia, Alberta, Quebec, Newfoundland and Labrador, Yukon, Nunavut, and more.

The OSC noted that the fund would purchase only the primary cryptocurrency and enable investors to buy in with US dollars or Canadian dollars. It will trade on the Toronto Stock Exchange (TSX).

Furthermore, the ETF’s custodian will be Cidel Trust Company – a subsidiary of Cidel Bank Canada. Interestingly, the sub-custodian will be Cameron and Tyler Winklevoss’s crypto company Gemini, while Ernst & Young will serve as the auditor.

While the US still explores the idea of such type, Canada’s approval finally brought to light mainland North America’s first Bitcoin ETF.