Canada-based crypto exchanges impose $30k CAD annual limit on altcoin buys to protect users amid strict regulations by the authorities. Newton and Bitbuy are the two crypto exchanges imposing a $30k CAD annual limit for restricted tokens.
Newton is a Toronto-based exchange. The company announced the new policy on Tuesday after successfully registering the exchange with the Ontario Securities Commission and other regulatory agencies in other provinces and territories of Canada.
According to the announcement, “these changes are to protect crypto investors, like yourself, and to make sure investors are aware of the risks associated with investing in crypto assets.”
As per the new policy, crypto traders and investors based in Ontario would be subjected to an annual $30,000 CAD limit on all cryptocurrencies, except Litecoin (LTC), Ether (ETH), Bitcoin Cash (BCH), and Bitcoin (BTC). The announcement clarified that if a trader buys and sells a restricted token, the sell amount would be deducted from the limit. The announcement noted that the limit resets after every 12 months from the date the first buy was made.
Network also announced that it has successfully registered the exchange with relevant agencies in the province of Ontario. With the registration, this means all traders and investors are subject to the rules and regulations put in place by the Ontario Securities Commission (OSC). Other changes made by Network to protect investors and traders include a “trading questionnaire.”
The questionnaire requires that all traders will provide information relating to their trading experience and also answer questions to prove that they understand the crypto terrain and its associated risks. This is a new requirement to be able to fund your trading account on Network. The $74 million price tag makes Uniswap Foundation proposal gets mixed reactions from crypto investors.
Bitbuy also confirmed that it imposed a similar policy earlier in the year. Bitbuy noted that the changes will affect traders in provinces like Manitoba, New Brunswick, Newfoundland, and Labrador, Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon.
Bitbuy also requires traders to complete a questionnaire before they are able to fund their trading account. The questionnaire is designed to help the exchange understand whether or not a user qualifies as a Retail investor, Sophisticated investor or Eligible investor. Bitbuy stressed that Retail investors are subjected to the $30,000 CAD annual restriction, but that Eligible Investors can transact up to $100,000 CAD threshold, and no purchase limit exists for Accredited Investors.
Consumer protection is not the only focus of the Canadian authorities. The Canadian government, in April 2021, announced that the parliament was considering legislation to review the country’s financial sector, with a focus on improving digital currency security and stability.