Canada Urges Alert: No Crypto Exchange guarantees Safety

The Canadian Securities Administrators (CSA) published a warning note to investors that called for caution when trading on cryptocurrency exchanges
11 June 2018   488

Although online exchanges declaring to be registered or verified, the CSA explained that none of them were accepted officially in Canada. The CSA is the governmental structure on regulating securities in Canada. Its jurisdiction is spread over 10 provinces and 3 areas and is responsible for developing a proper framework for securities trading and investor protection. The CSA-published warning urged the Canadian residents to be careful when dealing with cryptocurrency trading platforms, because no operator has the requisite permission to formally conduct trading operations in the country.

We want investors to understand that just because a platform may advertise itself as an exchange, that does not mean the platform is complying with applicable securities regulations.
Louis Morisset
Chair, CSA

Any investor with a cryptocurrency exchange account can not be defended according to Canadian securities and investor laws. In the unforeseen scenario that a firm gets shut down, loses its users’ funds, or is attacked, an investor can lose the entire balance they kept with the entity with little recourse available from the CSA or otherwise. 

The law informs that any such exchange seeking registration to process as a crypto exchange to service Canadian investors have to ensure “secure handling of client funds, appropriate safekeeping and protection of assets, confidentiality safeguards for personal information, reliable processes for pricing and trading in crypto assets, appropriate investor pre-trade disclosures and measures against market manipulation and other harmful practices.”

The note resembles CSA-published letter in August 2017, that alerted investors about the cryptocurrency prices that could differ from region to region giving rise to arbitrage possibilities. The high arbitrage, however, was estimated by authorities as harmful for retail investors.

Binance to Partner with Chainalysis for AML

Use of Chainalysis KYT solution will allow to compile with KYC- and AML-norms and also simplify the process of opening bank accounts
18 October 2018   96

The largest exchange by daily trading volume Binance uses software from Chainalysis, called Chainalysis KYT [know your transaction], to monitor real-time transactions and identify transfers related to criminal activity. This is stated in a joint press release.

Cryptocurrency businesses of all sizes face the same core challenge: earning the trust of regulators, financial institutions and users. We expect many to follow Binance's lead to build world-class AML compliance programs to satisfy regulators globally and build trust with major financial institutions.
 

Jonathan Levin

Co-Founder and COO, Chainalysis

Thus, the use of software from Chainalysis not only guarantee compliance with the KYC- and AML-norms, but also simplify the process of opening bank accounts.

By working with Chainalysis, we are able to continue building a foundational compliance program that enables the next phase of our growth. Our vision is to provide the infrastructure for a blockchain ecosystem and increase the freedom of money globally, while adhering to regulatory mandates in the countries we serve.
 

Wei Zhou

CFO, Binance

Chainalysis KYT release was held in April.