Kraken to Suspend Trading of Stablecoins in Canada
Crypto exchange Kraken has announced its plans to suspend trading, deposits, and withdrawals for various reserve-backed assets in Canada. This move comes as other Canadian exchanges have also implemented restrictions on stablecoin trading due to regulatory guidance on the legal status of such tokens.
No More Value-Pegged Tokens at Kraken
Kraken has confirmed that it is required to suspend deposits, withdrawals, and trading in Canada for Tether (USDT), Dai (DAI), Wrapped Bitcoin (WBTC), Wrapped Ether (WETH), and Wrapped Axelar (WAXL). The suspension will take effect on November 30th for deposits and trading, and on December 4th for withdrawals. Any remaining assets will be converted into USD at the prevailing market rate on December 5th.
Kraken advises users who hold balances in any of these assets to consider supported trading pairs or withdraw their funds before November 30th.
Canada’s Crackdown on Stablecoins
This isn’t the first stablecoin crackdown in Canada. Coinbase and Crypto.com have also suspended support for stablecoins in the country. The Canadian Securities Administrators (CSA) clarified in December that they view value-pegged crypto assets as securities. As a result, crypto trading platforms are prohibited from allowing Canadian clients to trade or obtain exposure to such assets.
Despite the strict regulations, Coinbase has praised Canadian lawmakers for recognizing citizens’ right to self-custody and understanding the unique nature of stablecoins compared to other cryptocurrencies.
Hot Take: Kraken Suspends Stablecoin Trading in Canada
Kraken’s decision to suspend trading, deposits, and withdrawals for stablecoins in Canada reflects the regulatory environment surrounding these assets. With the Canadian Securities Administrators classifying value-pegged tokens as securities, exchanges are facing restrictions on offering such assets to Canadian clients. This move follows similar actions by other exchanges in the country, including Coinbase and Crypto.com. While the regulations may limit access to stablecoins in Canada, they also demonstrate the efforts of Canadian authorities to establish clear guidelines for the crypto industry. As the legal landscape continues to evolve, it will be interesting to see how stablecoins and other cryptocurrencies are regulated globally.
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