Binance Pushes Back Against ‘Broad Inquiry’ From Canadian Securities Regulator

Binance received the probe on May 10, just before the exchange announced it was leaving Canada on May 12

article-image

Grey82/Shutterstock modified by Blockworks

share

Binance faces a probe from the Ontario Securities Commission (OSC) and was served with the documents on May 10.

On May 12, Binance announced that it was withdrawing from the Canadian market. 

“Unfortunately, new guidance related to stablecoins and investor limits provided to crypto exchanges makes the Canada market no longer tenable for Binance at this time,” Binance said in a statement on Twitter.

Binance, in a document filed with the Capital Markets Tribunal on May 18, has requested that the Tribunal “quash the Summons” it received from the OSC.

Binance claims that the OSC is conducting an “extremely broad inquiry into whether Binance may have taken steps to circumvent Ontario securities law and compliance controls in relation to Binance.com or engaged in conduct contrary to Ontario securities law and/or the public interest without any limitation.”

“While we respect the investigative process of any regulator, including the Ontario Securities Commission, we consider this latest action by the OSC to be ungrounded. The OSC has made a request to access virtually limitless private data in the hope they may find something untoward,” a Binance spokesperson told Blockworks via email. 

The summons included a blanket request for “all communications regarding Ontario (or Canada generally) among directors, officers, employees, contractors, agents and consultants of Binance Holdings Limited and related entities, including Binance Canada Capital Markets Inc […] since January 1, 2021, without limitation.”

In an amended tribunal application, Binance claims that the OSC is requesting the exchange produce documents “outside of its custody or possession, which is beyond the Commission’s investigative powers.” 

In a statement dated March 17, 2022, the OSC acknowledged Binance’s undertaking and said that the exchange “confirms that activities involving Ontario residents have ceased, apart from certain permitted actions to protect investors.”

The agreement between the OSC and Binance acknowledged that Binance would not open new Ontario accounts and would wind down business “in certain products” while “ceasing trading in existing accounts.”

“In early 2022, Binance reached an agreement with the OSC committing to several actions, including restricting Ontario users and providing quarterly reporting to the OSC. Since signing this agreement, Binance has diligently fulfilled its terms. In fact, at no time has the OSC indicated that Binance is in breach of the agreement,” the spokesperson said. 

The probe came after Binance acknowledged that it had incorrectly notified Ontario users that they could continue to use the platform after December 29, 2021. 

“Additionally, Binance commits that it will continue to prevent any activities involving Ontario residents, apart from these permitted actions […] Binance undertakes to maintain these restrictions until further notice to Binance by the OSC,” the 2022 statement said.

Another document, filed on May 29, shows that a hearing will be held on June 2.

“To be clear, Binance has strong controls in place to prevent Ontario residents from trading on our platform. Nothing has changed that would warrant this open-ended, overly broad investigation. We will vigorously defend our business, the crypto community and the industry against this action,” the Binance spokesperson told Blockworks. 

In a Twitter Spaces on Wednesday, Binance CEO Changpeng Zhao discussed Binance’s departure, “So basically, in order to fulfill all of those regulatory requirements [in Canada], we cannot use our current product or products. We will have to build something new. That’s something very customized, and something that probably — well, we view — that operationally will be very expensive.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

recent research

Unlocked Advisory-min.png

Research

This report distills Blockworks Advisory’s research on incentive programs and their analysis, offering a foundation for designing future initiatives and advancing industry-wide standards. By highlighting key lessons and methodologies, we aim to empower protocols to make informed, data-driven decisions.

article-image

Many analysts expected bitcoin to top $100K before year-end, though it’s been on a post-election tear

article-image

Will investors take a 10% lower return to get access to a regulated investment wrapper?

article-image

Brian Armstrong called out the hire of Gurbir Grewal, who had been the SEC’s enforcement division director since 2021

article-image

Certain senators will be interested to learn about Atkins’s private sector business interests, specifically those related to crypto

article-image

Innovative smart debt and collateral features are fueling Fluid’s rise to $1.2 billion TVL, reshaping the Instadapp brand

article-image

Crypto’s liquidity engine is now worth over $300 billion