In a recent announcement, dYdX, a cryptocurrency derivatives exchange, revealed its strategy to depart from the Canadian market. The company will be banning user accounts in Canada over the next week as part of this plan.
Ceasing Onboarding Process and Transitioning Current Users into Close-Only Mode
As per the company’s blog post on April 7, dYdX stated its intention to “wind down services” in Canada. The exchange will begin by ceasing the process of onboarding new customers situated in the nation. On April 14, the platform will transition all of its current Canadian users into a “close-only mode.” This mode will enable them to withdraw monies from their accounts, but they will not be able to execute any trades.
dYdX’s Commitment to Financial Opportunity and Transparency
According to the exchange, “dYdX is committed to providing transparency around product decisions and democratizing access to financial opportunity.” The company expressed high hopes that the current regulatory environment in Canada would evolve in the coming years, making it possible for them to continue their services in the country.
The Decision to Depart from Canada
dYdX made this decision after the Canadian Securities Administrators announced further limits on the registration requirements for cryptocurrency exchanges in the country. To comply with the regulations, platforms have to “prohibit Canadian clients from entering into crypto contracts to buy and sell any crypto asset that is itself a security and/or a derivative.”
Disapproval of dYdX’s Promotion Campaign
In September 2022, dYdX offered a $25 deposit bonus for validating someone’s identification using a live webcam picture. Many customers of dYdX and those involved in the cryptocurrency field expressed their disapproval of this campaign. Eventually, the initiative was discontinued by the exchange, citing “overwhelming demand” rather than privacy issues that were raised.
dYdX, the cryptocurrency derivatives exchange, has announced its decision to ban user accounts in Canada and depart from the market. The company stated its commitment to transparency and democratizing access to financial opportunities while expressing hopes that the regulatory environment in Canada will evolve in the coming years. The decision to depart from Canada came after the Canadian Securities Administrators announced further limits on the registration requirements for cryptocurrency exchanges in the country.