Canadian Regulator Insists Binance Is Unauthorized, Calls the Crypto Exchange's Letter to Users 'Unacceptable'

The Ontario Securities Commission (OSC) claims that Binance has rescinded its commitment to comply with previously agreed requirements. The crypto exchange told the regulator that there would be no new transactions involving Ontario residents after Dec. 31. However, Binance recently informed its Ontario users that they no longer have to close their accounts by year-end.

OSC Says Binance’s Action Is ‘Unacceptable’

Cryptocurrency exchange Binance got into trouble with the Ontario Securities Commission (OSC) Thursday. Binance notified its users in June that Ontario was becoming a restricted jurisdiction and users may need to close their accounts. However, the crypto exchange sent a letter to its users Wednesday stating:

As a result of ongoing and positive cooperation with Canadian regulators, there is no need for Ontario users to close their accounts by December 31, 2021.

The exchange also informed its users: “Binance in Canada has been successful in taking its first steps on the regulatory path by registering in Canada as a money services business with FINTRAC. This registration allows us to continue our operations in Canada and resume business in Ontario while we pursue full registration.”

However, the Ontario Securities Commission issued a notice Thursday “notifying investors that Binance is not registered under securities law in Ontario.”

The regulator wrote, “Binance represented to OSC Staff that no new transactions involving Ontario residents would occur after December 31, 2021,” elaborating:

Binance has issued a notice to users, without any notification to the OSC, rescinding this commitment. This is unacceptable.

“No entity in the Binance group of companies holds any form of securities registration in Ontario,” the Canadian regulator stressed. “This means they are not authorized to offer trading in derivatives or securities to persons or companies located in the province.”

The OSC clarified: “Unregistered platforms operating in Ontario may be subject to action, including temporary orders, to ensure compliance which could affect their ongoing local business operations.”

The regulator further noted that there are currently six crypto-asset trading platforms registered in Ontario.

Besides Canada, Binance has gotten into trouble with a number of regulators in other jurisdictions including the U.S., U.K., South Africa, Australia, Norway, Netherlands, Hong Kong, Germany, Italy, India, Malaysia, Singapore, Turkey, and Lithuania.

The exchange says it is currently focusing on compliance. This week Binance received in-principle approval from the Central Bank of Bahrain to operate a cryptocurrency service provider in the country.