In a recent development, Binance Holdings, a prominent cryptocurrency exchange, has been directed by the Ontario Securities Commission, one of Canada’s securities regulators, to probe into allegations of circumventing local regulations and compliance protocols while seeking regulatory approvals in the country.
According to a disclosure made by Binance in its filing with the Capital Markets Tribunal, the investigation order was served on May 10. Remarkably, just two days after receiving the order, Binance made a surprising announcement of its withdrawal from the Canadian market. The decision was attributed to the emergence of fresh regulatory guidelines pertaining to stablecoins and investor limits, signaling a significant shift in the company’s operational strategy.
The order authorised “an extremely broad inquiry into whether Binance may have taken steps to circumvent Ontario securities law and compliance controls in relation to Binance.com or engaged in conduct contrary to Ontario securities law and/or the public interest,” according to Binance’s legal representation Borden Ladner Gervais.
Binance has been grappling with mounting regulatory and legal challenges across various jurisdictions in recent years. The latest development involves a lawsuit filed by the US Commodity Futures Trading Commission (CFTC) against Binance and its CEO Changpeng Zhao.
Against this backdrop, Binance has now disclosed that it has received an order from the Ontario Securities Commission (OSC), although specific details of the order are not currently accessible to the public. Binance has indicated that the OSC’s decision was prompted by the CFTC’s lawsuit, thereby underscoring the interconnected nature of these legal actions.
Following the collapse of the trading platform FTX last year, Canada has taken a firm stance by implementing stricter regulations on cryptocurrency companies. This regulatory shift has led to the withdrawal of several prominent exchanges from the Canadian market, including OKX and Bybit.