Gemini and Other Crypto Platforms Exit Canada Amid Compliance Challenges

Gemini's exit reflects a rise in decentralized platforms abandoning Canada because of compliance challenges.

Gemini crypto exchange users in Canada will have their accounts closed by the end of 2024, following the company’s decision to leave the market.

The move comes after Canada’s new crypto regulations, which require exchanges to complete a pre-registration declaration to continue operating in the country.

Exchanges must also obtain CSA approval to offer stablecoins to Canadian customers. Several major crypto exchanges have left the market due to the strict regulations.

Gemini had initially agreed to the rules and registered its pre-registration in April 2023. However, despite expressing its commitment to its Canadian operations, the company has now decided to fully withdraw from the market.

Most Gemini accounts in Canada will be closed by December 31, 2024, according to the company. Canadian users have been advised by Gemini to withdraw their assets within 90 days, and they will receive further instructions from the exchange.

Gemini’s exit from Canada is part of a broader trend of decentralized platforms leaving the country due to challenges in complying with the new regulations.

Some companies initially submitted pre-registration forms but later changed their stance after reviewing the new regulations. Binance announced in May 2023 that it would be leaving the Canadian market after initially signaling its willingness to comply with the regulations.

Additionally, services from dYdX and Bybit in Canada have also ended their operations in the country. The CSA has been increasing its oversight to protect investors in response to the high-profile failures of crypto exchanges.

As a result, exchanges operating in the country face several restrictions, including limits on the use of stablecoins.

The CSA implemented these policies following the collapse of major crypto platforms such as FTX and Celsius Network. The regulator aims to ensure that Canadian investors are protected and to prevent further financial failures. As a consequence, several exchanges have opted to move their operations out of the country.

Ohio Pushes for Cryptocurrency in Tax Payments

While Canada is tightening its regulations on cryptocurrency, Ohio is making efforts to adopt it.

Ohio State Senator Niraj Antani introduced a bill on September 30 that would allow the state to accept cryptocurrency for tax and fee payments. State agencies and pension funds would also be permitted to invest in cryptocurrency under the bill.

Each year, the Ohio tax commissioner will specify the cryptocurrencies that can be used in these transactions, according to the proposed law. The bill defines cryptocurrency as any digital asset that is decentralized, has its own blockchain, and is used as a medium of exchange, but it does not include a central bank digital currency.

Entities in the state may impose a service charge to process crypto transactions, as specified in the bill, to encourage the adoption of digital assets. Ohio previously attempted to allow cryptocurrency for tax payments in 2018, but the effort was blocked.

Ohio has renewed its attempts to integrate and oversee cryptocurrency in its regulations. These proposals include additional measures to protect the state’s crypto mining industry and to exclude CBDCs from state monetary regulations.