Canadian exchanges’ cap on annual purchases only excludes Bitcoin, Ethereum, Litecoin and Bitcoin Cash
In line with the regulations, Canadian crypto exchanges are introducing measures to limit the annual purchase limit for selected crypto assets to CAD 30,000 (USD 23,250) per year – and these exclude (only) four major coins.
While the tariff will not affect Canadian crypto-investors’ capacity to invest in any of the leading coins, it will likely reduce their purchases of a wide range of altcoins.
Canadian crypto exchange Newton said in a statement explaining the new limits to users that “over the past few months” they have been working “quietly” on our registration with Ontario Securities Commissionas well as the securities regulatory authorities of other Canadian provinces and territories, adding:
“You may already be familiar with these changes as they affect all Canadian crypto trading platforms, not just Newton.”
Depending on the customer’s province of residence, they may have net purchase limits imposed on their account.
Users will be able to see these limits on the Newton app when they go to make a trade. Limits exclude bitcoin (BTC), ethereum (ETH), litecoin (LTC) and bitcoin cash (BCH).
The limits do not apply to users living in British Columbia, Alberta, Manitoba or Quebec, according to the platform.
This means that the annual net purchase limit will be imposed on residents of the following Canadian provinces: New Brunswick, Newfoundland, Nova Scotia, Nunavut, Northwest Territories, Ontario, Prince Edward Island, Saskatchewan and Yukon.
Newton said the regulatory changes were developed with the aim of “protecting crypto investors […] and to ensure that investors are aware of the risks associated with investing in cryptoassets.”
Equivalent Canadian crypto exchange Bitbuy announced limits earlier in the year, stating:
“The limits are defined as ‘net buy limits’, meaning they add up all your crypto purchases minus your sales (at average price), over a rolling 12 month period (last 365 days).”
As in the case of Netwon, there are no limits on BTC, ETH, LTC and BCH, while “all other coins combined” have a limit between CAD 30,000 in net purchases (total purchases (at purchase price) minus total sales (at average cost) ) in the last 12 months for retail investors, and CAD 100,000 for qualified investors.
Still, the latest development has sparked a range of reactions across the cryptosphere.
Ethereum co-founder Vitalik Buterin said he is happy to see the backlash against these regulations:
Simon Dixon, CEO and Founder of BNKtothefuture.com, tweeted that if “you do something stupid like Canada best to go with % of net worth instead of annual sum”.
However, Cale Moodie, president and CEO of the Neptune Digital Assets, argued that the furor over Newton’s announcement is “an example of how Twitter users spin information to annoy people. There is a brokerage law that means regulated brokers cannot load shitcoins into their client accounts in certain provinces. It will not affect any individuals in Canada,” claimed Moodie.
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– Canadian Regulator Reports Coinbase, Kraken CEOs’ Crypto Custody Tweets
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