Coinbase Terminates Tether’s USDT and RAI Trading in Canada
The American-based crypto exchange Coinbase announced discontinuing Tether’s USDT trading alongside DAI and RAI, alleging they failed to satisfy the listing standards. The move by the second largest crypto exchange in transaction volume makes the three popular stablecoins inaccessible to Canadian users.
Coinbase Enters Canada Targets Cementing Presence in North American Market
The move comes shortly after Coinbase lauded its full entry into the Canadian crypto market, a move portrayed as cementing its grip on the North American market.
An email sent to the Coinbase customers on Monday, August 14, informed them of the nonavailability of USDT, DAI, and RAI, citing it failed to satisfy the listing standards during the recent housekeeping review.
Coinbase stated that the suspension would not hinder access to the three suspended stablecoins’ wallets. Users would still access deposit and withdrawal services after the August 31 deadline.
Coinbase Mirrors Crypto.com Move to Discontinue USDT in Canada
While Coinbase failed to extend details over, the suspension mirrors the move by the Crypto.com exchange that also discontinued Canadian support for USDT. The suspension announced in January indicated that the suspension involved a direct response to the directive issued by the Ontario Securities Commission (OSC).
The suspension of USDT trading by the two exchanges is informed partly by the Canadian Securities Administrators (CSA) labeling the stablecoins, including Tether, alongside value-pegged assets such as Wrapped Bitcoin (wBTC) as securities.
CSA restated that the directive prohibits all crypto exchanges from allowing their Canadian customers to trade and secure exposure to all digital assets and tokens labeled as security and derivative.
Coinbase Complies With CSA Directive to Prohibit Crypto Exchanges
Coinbase move suggests the crypto exchange is complying with the same CSA directive in the decision to scrap supporting Tether’s USDT on the Canadian platform.
Nonetheless, Coinbase own stablecoin and second-ranked USDC are available to Canadian traders on its platform. Stablecoins comprise crypto tokens whose value is pegged to real-world assets, including fiat currency.
Stablecoins are targeted at maintaining steady pricing. Thus, Integral serves as dollar equivalents. Their existence suits territories restricting access to US dollars. Additionally, stablecoin attracts increased usage from DeFi traders when entering and exiting positions on the decentralized exchanges.
Concerns Raised Over USDT Audit and Reserve
Tether’s USDT stablecoin is the leading of the three banned crypto assets, given that its market capitalization estimates at $82 billion. Also, it witnesses heavy usage, given the multiplicity of pairing available. Its heavy trading that even exceeds Bitcoin attracts endless concerns.
Tether’s critics question whether reserves fully support the stablecoin. The critic indicated that Tether is yet to disclose the full audit of the claimed reserves.
Coinbase announced the changes coincidentally with its statement on Monday, August 14, confirming entry into the Canadian market. It indicated that the entry would feature a full suite of services, including supporting instant electronic-based payments besides the previous trading services.
Canadian Authorities Considered More Welcoming
Coinbase executive for international business development Nana Murugesan lauded the approval by the Canadian authorities. He indicated that Canada offered a more welcoming platform, unlike the US, where the crypto operators are battling the regulation by enforcement.
Murugesan challenged authorities to embrace the Canadian approach of regulation by engagement. The executive’s praise of Canada arises from the participative platform extended by the authorities to the crypto stakeholders, unlike in the US.
The executive expressed skepticism in the US crypto market, where Coinbase is embroiled in a legal battle with the Securities and Exchange Commission (SEC). The regulator accuses Coinbase of violating the securities law without seeking registration.
Coinbase unveiling a composite suite of services in Canada contrasts Binance’s announcement in June that it was exiting the Canadian market. The largest crypto exchange by transaction volume cited the enforcement of a new regulatory framework concerning stablecoins and the imposition of investor limits.
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