- Coinbase said it is registered as a restricted dealer in Ontario with the Canadian Securities Administrators (CSA), the umbrella organization for Canada’s securities regulators.
- Last year, Canada introduced new guidelines for cryptocurrency exchanges, limiting the amount certain investors can invest in cryptocurrencies and imposing mandatory registration for cryptocurrency companies.
- Coinbase says it is the first international cryptocurrency exchange to accept restricted dealer registrations in Canada.
Coinbase has received a registration license in Canada, the company told CNBC, allowing it to expand further overseas as it faces a regulatory crackdown in its home market of the United States.
The company said it is registered in Ontario as a restricted dealer under the Canadian Securities Administrators (CSA), the umbrella organization for provincial and territorial securities regulators in Canada.
Obtaining the authorization means that the company has now met the strict requirements of Canadian regulators for crypto asset trading and can legally operate in the country.
Last year, Canada introduced new guidelines for cryptocurrency exchanges, limiting the amount certain investors can invest in cryptocurrencies and imposing mandatory registration for cryptocurrency companies.
The policy change led Binance, the world’s largest cryptocurrency exchange by volume, to withdraw from activities in Canada, saying it was “no longer able” to operate in the country.
Rival cryptocurrency exchange Kraken said last year that it had filed a pre-registration undertaking (PRU) with the Ontario Securities Commission, effectively launching the process to become a registered dealer in Canada.
Coinbase filed for its PRU in March 2023, before officially launching in the country in August of that year. The company said it was the first international cryptocurrency exchange to accept a restricted dealer registration in Canada.
“This is something we’ve been working on for almost three years in Canada, and more specifically, in conjunction with the Ontario Securities Commission over the last 12 months,” Lucas Matheson, Coinbase’s country director for Canada, told CNBC.
"We have been working diligently with regulators over the past year to build a compliant platform in Canada so we can serve Canadians."
Matheson said Canada’s regulatory environment is more relaxed for crypto platforms than the U.S.
Coinbase, and the broader crypto industry, has faced stiff opposition from the U.S. Securities and Exchange Commission in a major lawsuit alleging securities law violations.
Matheson noted that Canada launched the world’s first spot Bitcoin exchange-traded fund long before the United States – the Purpose Bitcoin ETF has now been trading for the past three years.
Huge market opportunity
Matheson said the market opportunity in Canada is huge.
“We have a population here that is highly educated, tech savvy and understands the digital economy,” Matheson told CNBC.
“Our registration in Canada makes us the first international and largest cryptocurrency exchange registered in Canada. This positions us well to help millions of Canadians enter the digital economy.”
Canada is home to some notable tech companies, including e-commerce giant Shopify and artificial intelligence startup Cohere. Coinbase CEO Brian Armstrong visited the country in November 2023 to meet with local teams and have a fireside chat with Shopify CEO Tobi Lutke.
Coinbase has a technology center in Canada with nearly 200 full-time local employees.
As the company seeks to further expand globally, Matheson said he is banking on Coinbase’s strengths as an exchange, which had received regulatory approval before launching.
“As a public company, as a company that’s committed to compliance and more broadly registered around the world, we have a strong brand in Canada,” he said. “I think Coinbase has built a strong customer base, customers who trust our platform, and the mission of Coinbase.
The license marks the latest victory for Coinbase, which has embarked on a global charm offensive to influence regulators and market its platform overseas.
In 2022, Coinbase unveiled what it called its “go broad, go deep” strategy, which aims to hire new leaders and fill local licenses in various international markets.
Last year, Coinbase chose Ireland as its primary regulatory base in the European Union, seeking to take advantage of the bloc’s new crypto rules. The company has also received separate approvals from France, Spain, Singapore, Italy, Ireland and the Netherlands.