Canadian Regulator Warns KuCoin for Securities Law Violation

After Poloniex, the Ontario Securities Commission (OSC) went after KuCoin, alleging that the cryptocurrency Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term had violated the Canadian state’s securities law.

In a press release published earlier this week, the state regulator issued the statement of allegation against Seychelles-incorporated Mek Global Limited and PhoenixFin Pte. Ltd., which is incorporated in Singapore. Both the firms operate the digital asset platform, KuCoin.

According to the regulator, KuCoin is an unregistered crypto asset Trading Platform Trading Platform In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real Read this Term and illegally offers citizens of Ontario trading services with 'securities and derivatives'.

“Staff will continue to take action against non-compliant crypto-asset trading platforms and are in contact with international securities regulators to exchange information to support enforcement action,” the Canadian state regulator stated.

Initially, the OSC issued a notice to all crypto trading platforms operating in the state to comply with the securities laws and get in touch with the regulator to discuss how to bring their operations into compliance.

“Platforms must contact OSC staff by April 19, 2021, to discuss how to bring their operations as a dealer or marketplace into compliance,” the regulator stated earlier.

However, KuCoin did not respond to the call.

Targeting Crypto Exchanges

A similar warning had been issued against Poloniex, another Seychelles-registered cryptocurrency exchange, that had never been registered with the OSC or specified Canada as one of its ‘Restricted Territories’.

Though Kucoin offers crypto derivatives trading, it is not clear which digital currencies the Canadian regulator is categorizing as securities.

Meanwhile, the state regulator has been friendly towards cryptocurrency exchange-traded funds (ETFs) and approved several in recent months for listing on the regular stock exchanges.

“Unregistered crypto asset trading platforms expose Ontario investors to significant risks, including potential loss, theft and misuse of their assets. The recent explosion of unregistered platforms has magnified these risks,” said Grant Vingoe, Chairman and CEO at the OSC.