Ontario Crypto Exchanges Impose ,000 Annual Limit on Altcoin Purchases

Ontario Crypto Exchanges Impose $30,000 Annual Limit on Altcoin Purchases

Ontario Crypto Exchanges Impose ,000 Annual Limit on Altcoin Purchases

Canada-based crypto exchanges Bitbuy and Newton impose an annual $30,000 (CAD) “purchase limit” for “restricted coins” for their Ontario-based users to “protect consumers” amid heightened regulations .

Newton, a Toronto-based crypto exchange, announced that the new changes come after working to register with the Ontario Securities Commission and securities regulators in other Canadian provinces and territories, noting in an August 16 article:

“These changes are intended to protect crypto investors, like yourself, and to ensure that investors are aware of the risks associated with investing in crypto assets.”

Under the new changes, Ontario-based crypto traders on Newton and other Canadian crypto platforms will be subject to an annual “net purchase limit” of $30,000 (CAD) on all crypto coins -currency except Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) and Litecoin (LTC).

Newton further clarified that if a trader bought and then sold a restricted coin, the amount of the sale would be subtracted from the limit. The limit resets every 12 months from the first purchase of restricted coins.

The purchase limits come as the crypto platform announced on Wednesday that it has officially registered as a “restricted dealer” in the province of Ontario, meaning it is now subject to the regulations issued by the Ontario Securities Commission (OSC) .

Other changes aimed at consumer protection include a “trading questionnaire,” in which the exchange is required to collect information from users about their past experience and knowledge of crypto investing, financial status, and risk tolerance – which must be met to continue funding the account and trading on the platform.

The crypto exchange will also send traders a notification if the trader’s portfolio receives a level of loss they indicated in the questionnaire that they are not comfortable with.

Canadian crypto exchange Bitbuy also confirmed similar purchase limits earlier in the year, noting that similar restrictions also apply to users in the provinces of Manitoba, New Brunswick, Newfoundland and Labrador. , Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon. .

Similar to Newton, Bitbuy asks traders to complete a questionnaire to determine if the investor qualifies as a retail investor, qualifying investor, or sophisticated investor. However, while retail investors remain subject to the purchase limit of $30,000, the purchase limit for eligible investors is increased to $100,000 and no purchase limit exists for accredited investors.

Newton provided traders with an overview of what they should expect when the new rules come into effect.

Source: Newton

The province of Ontario alone accounts for almost 40% of the Canadian population, with Toronto being the main metropolitan hub.

Newton noted that each province and territory in Canada has its own securities regulator, which combined make up the Canadian Securities Administrators (CSA).

Related: Clean crypto: how much application is too much?

Nor is consumer protection the only concern of Canadian regulators. In April 2021, the Canadian federal government announced that it would conduct a legislative review of the financial sector, with a particular focus on improving the stability and security of digital currencies and establishing a digital currency central bank (CBDC).

Newton, which bills itself as “Canada’s trusted low-cost crypto trading platform,” was founded in 2018 and is currently one of the most popular exchanges in Canada, having topped 100,000 users in February 2021.