Binance is ending its services in Ontario, Canada as crypto exchanges in the province face heightened regulatory scrutiny. In a statement, the global crypto exchange says that Ontario has become a restricted region effective Saturday, June 26th. It also asks users in the province to close their accounts by the end of the year. “As […]
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Hut 8 CEO Jaime Leverton said the firm was on track to mine up to 3 additional BTC per day by the end of August.
Toronto-based crypto mining firm Hut 8 said it plans to increase its self-mined Bitcoin holdings based on its expectation it will be able to expand its hashrate by 400%.
According to a Monday announcement, Hut 8 said it expects to hold 5,000 self-mined Bitcoin (BTC) — roughly $172 million — by the end of 2021, a more than 31% increase over its current 3,806 BTC. The company said the anticipated crypto holdings were based on it being able to increase its hashrate to “2.5 – 3.0 EH by the end of 2021 and to approximately 6 EH by mid-2022” — a 400% increase over its current levels.
“We now have 1.2 Exahash in production and ongoing installation of new equipment puts us on a near-term trajectory to produce an additional 2 – 3 Bitcoin per day by the end of August, on top of our current production rate of 6.2 – 7.3 Bitcoin per day,” said Hut 8 CEO Jaime Leverton.
The projected Bitcoin holdings follow Hut 8 completing a June 15 public offering, which earned the company more than $93 million in gross proceeds. The firm said it plans to use the funds for previously announced investments with crypto mining processor producer Nvidia, Chinese supplier MicroBT, and Validus Power for its energy requirements from mining.
Related: Bitcoin hash rate hits 8-month low as Chinese miners power down
China’s crackdown on Bitcoin mining has led to a significant drop in the network’s hash rate, with many firms forced to close their doors — particularly in Sichuan province. However, Hut 8 said it anticipates network difficulty to drop by up to 20% on July 1, “given the subsequent and ongoing exodus of miners in China.” Some reports have suggested that Chinese miners are considering relocating to Texas, a state with low-cost renewable energy in part due to looser regulations than those in many other states.
Hut 8 is one of the largest publicly traded Bitcoin mining firms alongside Marathon Digital Holdings, Riot, and Hive Blockchain. Stock for the firm has seen modest year-to-date gains in 2021, rising more than 24% to reach $3.80 at the time of publication.
Cryptocurrency exchange Binance will no longer provide services in the Canadian province of Ontario. The decision comes amid ongoing regulatory pressure on digital asset trading platforms that has already affected the operations of several exchanges. Crypto Exchange Binance Exits Canada’s Ontario Binance, which is one of the world’s leading cryptocurrency exchanges by daily volume, has […]
Ontario's crypto exchange crackdown continues as Binance plans to end operations Dec. 31, 20201.
On the tails of a warning from Japanese regulators on Friday, Binance has announced in a short statement yesterday that it will cease providing services to users located in Ontario.
“As part of our continuing compliance efforts, Binance has updated its Terms of Use to provide that Ontario (Canada) has become a restricted jurisdiction, effective 2021-06-26 at 3:59:59 AM (UTC). Regrettably, Binance can no longer continue to service Ontario-based users. Ontario-based users are advised to take immediate measures to close out all active positions by December 31, 2021,” a statement on their website reads.
Binance did not return a request for comment by publication time.
In recent weeks Ontario has emerged as one of the most aggressive cryptocurrency regulators. On April 19th, the regulator introduced new prospectus and registration requirements for cryptocurrency exchanges. Last week The Ontario Securities Commission announced it would be holding hearings regarding cryptocurrency exchange Bybit “flouting” Canadian law. Additionally, the regulator took steps against two companies associated with Kucoin earlier in the month:
“KuCoin is operating an unregistered crypto asset trading platform, encouraging Ontarians to use the platform, and allowing Ontario residents to trade crypto asset products that are securities and derivatives,” the OSC wrote.
Ontario regulators arn’t the only ones who have taken a closer look at Binance’s activities within their jurisdiction, however. On Friday, the Financial Services Agency (FSA) of Japan warned that Binance may be operating in the country without a license. The warning comes on the back of the governor of the Bank of Japan slamming Bitcoin as a “speculative asset” earlier in the year.
Japanese and Canadian Binance users worried about service ending in their countries might rest easier knowing that trading for some American users persisted for months on the main Binance site even after requests for users to migrate to Binance US. Additionally, Binance CEO Changpeng Zhao has admitted that Americans find “intelligent” ways to circumvent the geofence.
An exploration into the country’s crypto landscape today and what it means for the future of the digital asset industry in Canada.
Digital currencies are quickly becoming more mainstream within the Canadian financial landscape. Alongside this increased adoption, Canada has been relatively successful at creating a stable regulatory environment. In 2014, Canada established itself as a leader in the global digital asset space when the Canadian Parliament became the first government in the world to pass a national law on digital currencies. Since then, Canadian regulators have remained fairly proactive in their approach toward cryptocurrency, taking a cautious-yet-optimistic stance in an attempt to promote innovation while still protecting investor interests.
Especially in comparison to other international jurisdictions, which either impose stricter policies or harbor a more laissez-faire attitude, Canada’s supportive environment to cryptocurrency is reflected in some of the options offered to startups experimenting with digital asset technology.
For example, the Canadian Security Association’s (CSA) sandbox initiative supports financial technology (fintech) businesses seeking to offer innovative products by carefully vetting business models in live-testing environments. Similarly, the Ontario Securities Commission (OSC) LaunchPad works with financial service businesses to keep regulation aligned with digital innovation and encourage the development of products, services and applications that meet compliance standards required by securities laws.
In addition to these services aimed at innovators looking to collaborate directly with financial authorities in the context of their specific business model, regulators have also published broad, but comprehensive, guidance on navigating applicable legislative frameworks.
Related: Will regulation adapt to crypto, or crypto to regulation? Experts answer
The need for regulation has polarized the crypto industry ever since its inception. Investors and enterprises are hungry for processes, for which having a regulatory framework is a must. On the other hand, an over-regulated economy might isolate Canadians from integrating with the broader digital asset industry, forcing investments overseas. So, what is a good balance between the two?
Early advocates of blockchain presumed that its distinctive qualities of disintermediation make it insusceptible to regulation and argued that cryptocurrency had been created as a solution to the stringent public oversight of financial markets. Under this assumption, many token issuers before mid-2017 largely ignored securities law registration requirements meant to protect investors and foster fair markets.
However, reliable legal remedies are necessary for the protection of individual rights and are integral for a functionally accountable jurisdiction. Especially within the financial sector, where individuals are extremely vulnerable to risk, regulation minimizes consumer exposure to harm and is paramount for maintaining market integrity.
For example, it is now well established that Canadian businesses dealing with cryptocurrency (such as crypto exchanges) must register with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as a money services business (MSB). Registration means that these enterprises are subject to regulatory oversight and reporting requirements. As a result of these legislative obligations, fraudulent actors are more likely to be squeezed out of the space to make room for lawful players who can provide higher levels of investor protection. This legitimization of the digital asset industry is primarily why trading platforms are welcoming progressive regulation; working constructively between one another to increase security and transparency without stifling an industry that is still in its infancy.
Related: QuadrigaCX users lose $190M as speculations over Cotten’s death swirl
Therefore, policymakers play an essential role in developing the necessary conditions to create a suitable framework for cryptocurrencies to operate safely. The CSA jurisdiction, along with the Investment Industry Regulatory Organization of Canada (IIROC), has expressed its interest in working closely with digital asset trading companies to understand their point of view, factor in key risks to innovation and ensure that investor protection is not compromised.
Regulations of this magnitude cannot be rushed, and several factors have been taken into account by regulators to ensure that any new legislation only encourages the digital asset industry to boom. Allowing Canada to operate as a successful crypto venue while safeguarding investment security and fraud prevention are some of the key elements of the proposed regulatory framework. The sweet spot for regulation is somewhere in between — stringent enough to protect investments and fraud, and permissible enough to allow private and international digital asset companies to thrive.
Related: How smart regulation can improve the future of blockchain
When it comes to the integration of crypto into traditional investing, Canada has been remarkably advanced with its sanctioning of Bitcoin (BTC) and Ether (ETH) exchange-traded funds in 2021, allowing more mainstream investors the opportunity to have digital asset exposure through their investment accounts, including tax-advantaged registered retirement savings plans (RRSPs) and tax-free savings accounts (TFSAs).
Canada also surpassed the United States by allowing digital asset exchange-traded funds (ETFs), setting a precedent of wanting to be competitive in the sector. In February, Purpose Financial LP’s Bitcoin ETF accumulated over $400 million assets under management within its first two days and went on to cross the $1 billion mark within two months post-launch.
With a growing portfolio of investments, one would assume that tax-related concerns could potentially arise. However, Canadian tax authorities have been fairly clear in matters of tax implications and have provided adequate guidance to investors along the way. Currently, Canada’s tax laws and rules, including the Income Tax Act, also apply to cryptocurrency transactions.
The Canada Revenue Agency has characterized cryptocurrency as a commodity and stated that the use of cryptocurrency to pay for goods or services should be treated as a barter transaction. Because cryptocurrency is treated as a commodity, it has prevented the unfavorable misreporting of taxes as a result. However, the landscape is constantly evolving, so regulators must remain ahead of the game to avoid crypto enthusiasts looking at the United States, Europe or Asia as alternative playgrounds, draining Canada of both its talent and its investment.
Related: Stablecoins present new dilemmas for regulators as mass adoption looms
Canada is a crypto miner’s top choice, owing to its climate, electric supply and light regulation. Hardware used by cryptocurrency miners generates a significant amount of heat and requires cooling to prevent overheating, and being located in a relatively cool climate like Canada helps to reduce the costs of cooling the computers. Furthermore, power rates in Quebec are among the lowest in North America. For industrial consumers, rates are around $0.05 per kilowatt-hour. Energy consumption is the main cost of cryptocurrency miners, and understandably the top reason they’re drawn to Canada.
Finally, there is potential for Canadian digital asset companies to not just offer trading but also own and operate crypto mining facilities. Canada offers a safe haven for miners coming from politically and financially unstable environments to carry out operations within a relaxed framework, putting the country at the forefront of the digital currency revolution. Miners from previously heavy crypto quarries like China are on the lookout for favorable pastures with less hostile regulations and are now looking at Canada as a lucrative alternative.
Thinking long term, there is also the sentiment of sustainability, and while traditional finance industries lean on carbon-based energy sources, digital assets are comfortably moving in the direction of greener energy. This is further confirmed by Square’s report on the Bitcoin Clean Energy Initiative — a unique energy model that could enable the installation and capacity of more sustainable methods of solar and wind generation. Canada is a global leader in sourcing renewable energy, and a flexible regulatory framework around cryptocurrency could mean an influx of international players heading to “The True North.”
Related: Ignore the headlines — Bitcoin mining is already greener than you think
With the digital asset space being internet-native, fintech platforms can be built anywhere in the world. This globalization of the financial industry means that Canada cannot simply wait for a regulatory framework to become available, or it will lag behind in the innovation race. The onus is on regulators to incentivize digital asset investment and project development in their country.
Familiarizing the Canadian market with digital asset trading with the introduction of more crypto-asset trading platforms is a solid first step. The next decade will see a lot more regulation introduced into the sector. Governments that are smart and forward-thinking will see an obvious opportunity to offer clear but not overly restrictive regulation, and become a welcoming place for digital asset projects.
Historically, authoritarian governments — where hostile and unstable rule-making induces a net negative to their economy — are more likely to impose stricter measures on digital assets, which could inevitably force industry participants to move to countries like Canada that offer relatively favorable conditions. Digital asset companies will continue to move to wherever they are most welcome, and the countries that facilitate these moves will be much better positioned to reap the benefits of the digital asset industry as it continues to grow and threaten traditional finance.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Most of the crypto community has been focused on the developments in China and more specifically, the crackdowns against bitcoin miners in Inner Mongolia, Xinjiang, Qinghai, Yunnan, and Sichuan. On Wednesday morning (EST), Bitcoin’s overall hashrate has continued to drop and is now below the 100 exahash per second (EH/s) region. During the last 24 […]
3iQ launched its Bitcoin Fund trading on Nasdaq Dubai after receiving regulatory clearance for a dual listing in April.
Canada’s largest digital asset investment fund manager, 3iQ, is expanding its reach to global investors by listing its public Bitcoin (BTC) fund on a major market in the Middle East.
3iQ rolled out its Bitcoin Fund (QBTC) for trading on Nasdaq Dubai, according to an official statement by the exchange. Trading went live on Wednesday at 10:00 a.m. Dubai time.
The new listing marks the emergence of Middle East’s first indexed digital asset-based fund, 3iQ chairman and CEO Frederick Pye previously said. Pye was optimistic about BTC price, predicting a new all-time high in 2021:
“I believe that, whether it happens this year, Bitcoin is going to get to a new all-time-high. Yesterday’s Bitcoin closed at $32,000-a-unit and this morning it opened up at $34,000, so we got about a five percent boom in the price of Bitcoin since yesterday. Hopefully we’re going to get a good move on the first day of the Dubai Nasdaq.”
Related: Bitcoin ETF from 3iQ and CoinShares goes live in Canada
3iQ received regulatory clearance for a dual listing of the Bitcoin Fund on Nasdaq Dubai in April 2021, planning to start trading in the second quarter. Pye said that the company was also in talks with other exchanges in Singapore, Taiwan, Sweden and the United States to list the fund.
The firm is one of the largest cryptocurrency companies in Canada. It became the first crypto fund to be regulated by the Ontario Securities Commission and the Canadian Securities Administrators in January 2018. In 2020, 3iQ was the first Canadian company to launch a public Bitcoin fund on the Toronto Stock Exchange.
The commission alleges Bybit exposes local investors "to unacceptable risks and create[s] an uneven playing field within the crypto asset trading platform sector.”
The Ontario Securities Commission has issued a notice stating that it will be holding a hearing against Bybit regarding the crypto exchange allegedly “flouting” Canadian securities law.
In a Monday notice from the Ontario Securities Commission, or OSC, the regulatory body alleged Bybit had “failed to comply with the registration and prospectus requirements under Ontario securities law” despite the OSC issuing an April 19 deadline for crypto exchanges operating in the province. As a result, the commission will be holding a hearing as early as July 15 to address the matter.
“A process is in place for crypto asset trading platforms to bring their operations into compliance with Ontario securities law,” said the OSC. “Entities such as Bybit, which flout this compliance process, expose Ontario investors to unacceptable risks and create an uneven playing field within the crypto asset trading platform sector.”
The regulatory body alleges that Bybit has not filed a prospectus with the OSC to legally operate in Canada, while the exchange provides instruments and contracts to investors which constitute securities and derivatives under Canadian securities law. Such trades would reportedly violate portions of the Ontario Securities Act and involve activity “that is contrary to the public interest.”
The proposed July hearing will address solutions, including that Bybit cease trading for a given period and “be prohibited from acquiring any securities permanently.” The OSC also proposed fining the exchange up to $1 million for each alleged violation of the securities law.
Related: Japanese watchdog issues warning to crypto derivatives exchange Bybit
In separate statements from the OSC in the last month, the commission made similar allegations against crypto exchange KuCoin and Polo Digital Assets, the parent company of Poloniex. In both cases, the OSC alleges the exchanges failed to contact the securities regulator by the April 19 deadline.
The Canadian province of Ontario has become home to many crypto firms pushing new boundaries in local regulations. In February, Toronto-based Purpose Investments launched the first Bitcoin exchange-traded fund, or ETF, in North America, a fund that has since grown to more than $880 million assets under management. Evolve Funds Group and Ninepoint Partners have also received regulatory approval for crypto ETFs.
CEBL, the Canadian men’s basketball league, will offer its professional basketball players the option to receive a portion of their salary in cryptocurrency. The new payment option has been enabled through a partnership with the Canadian cryptocurrency exchange Bitbuy. Bitbuy to Convert Canadian Dollar Salaries Into Bitcoin The Canadian Elite Basketball League (CEBL) announced the […]
"The ability to have part of my salary go directly into an investment that I believe will appreciate greatly over the next 10-30 years is a no-brainer,” said Guelph Nighthawks guard Kimbal Mackenzie.
The Canadian Elite Basketball League will be allowing players from its seven teams to accept a portion of their salaries in Bitcoin starting next week.
According to a Thursday announcement, the Canadian Elite Basketball League, or CEBL, has partnered with Toronto-based cryptocurrency exchange Bitbuy to convert part of basketball players’ existing salaries from Canadian dollars to Bitcoin (BTC) on request. The league said it will arrange for the funds to be delivered to the players’ personal crypto wallets.
More than 70 players on the active roster from the Edmonton Stingers, Fraser Valley Bandits, Guelph Nighthawks, Hamilton Honey Badgers, Ottawa Blackjacks, Niagara River Lions, and Saskatchewan Rattlers will be seemingly eligible for the crypto payments. Bitbuy will also be joining the CEBL as an official sponsor.
The Nighthawks’ Kimbal Mackenzie said he would be one of the first players to accept the CEBL’s offer. The 24-year-old guard recently re-signed with the team for the 2021 CEBL season beginning June 24.
“The opportunity to be paid in Bitcoin is something I’m incredibly excited about,” said Mackenzie. “I believe cryptocurrency is the future. The ability to have part of my salary go directly into an investment that I believe will appreciate greatly over the next 10-30 years is a no-brainer.”
Related: NFL player Russell Okung isn’t getting paid in Bitcoin
Though many sports franchises and organizations have partnered with crypto and blockchain firms, many people have expressed concern about Bitcoin as a medium of exchange given the crypto asset’s price fluctuations. Mackenzie added in a separate interview that he would accept half of his salary in Bitcoin and was seemingly unconcerned about any potential volatility:
“[If Bitcoin falls], so be it. It was a decision I was prepared to make. On the other hand, if it increases, maybe I will retire in two years.”
Since reaching an all-time high price of $64,899 in April, Bitcoin has dropped significantly following Tesla CEO Elon Musk saying the company would stop accepting the crypto asset as payment for vehicles due to environmental concerns. At the time of publication, the BTC price is $36,788, having fallen more than 5% in the last 24 hours.
