Cryptocurrency exchange Bybit has decided to exit the Canadian market, joining the ranks of other major platforms like Binance, citing recent regulatory developments as the primary driver. The move comes as Canada enforces new guidelines for crypto companies, requiring approval from the Canadian Securities Administrators (CSA) and undergoing various due diligence checks.
In a blog post on Tuesday, Bybit expressed its commitment to operating within the framework of relevant rules and regulations in Canada. However, the recent regulatory developments have prompted the exchange to take the difficult but necessary step of pausing the availability of its products and services. As of May 31, new account openings will no longer be accepted, while existing customers will have until July 31 to make new deposits and enter into new contracts. After this date, customers will still have the ability to withdraw funds or reduce their positions.
The challenging regulatory landscape in Canada
Bybit’s departure from the Canadian market highlights the increasing regulatory challenges cryptocurrency exchanges face. The country’s regulatory climate has prompted several major platforms, including Binance, to withdraw their operations. The new guidelines issued by the CSA in February have created a demanding environment, compelling crypto asset trading platforms to seek approval and pass due diligence checks.
While Bybit and Binance have chosen to exit the Canadian market, other exchanges, such as Coinbase, remain committed to their operations in the country. Coinbase has praised Canada’s approach for providing clear rules, signaling its dedication to the Canadian market and a determination to strengthen its operations there.
Bybit’s decision to exit the Canadian market comes as the exchange expands its global presence and explores new markets. The company recently obtained “in-principle” approval from regulators in Kazakhstan, signaling its intention to establish a foothold in this emerging market. This strategic move follows Bybit’s introduction of cryptocurrency lending services, aiming to cater to the growing adoption of digital assets and provide a safer and more sustainable trading experience for crypto enthusiasts while ensuring necessary safeguards.
Bybit joins the growing list of crypto firms that have decided to withdraw from Canada due to regulatory concerns. In April, decentralized exchange dYdX announced the “winding down” of its services for Canadian users, citing the country’s regulatory climate as a factor. Similarly, major crypto exchange Binance announced its proactive withdrawal from Canada in May, citing the rules set by the Canadian Securities Administrators.
The exit of Bybit from the Canadian market further underscores the challenges cryptocurrency exchanges face operating within stringent regulatory frameworks. As the regulatory landscape continues to evolve, exchanges must adapt and navigate the requirements set forth by regulatory authorities to ensure compliance and maintain sustainable operations.
The divergence between platforms like Bybit and Coinbase highlights the contrasting approaches taken by exchanges in response to regulatory developments, ultimately shaping the future landscape of the cryptocurrency industry.