Recently, the digital currency derivatives exchange BitMEX has been announcing several adjustments to its mode of operation. One might predict that the exchange is looking to stay compliant with regulatory measures upheld by regulators to support cryptocurrencies. To that effect, the exchange will end support for customers in Ontario, Canada.
BitMEX Mandates Restriction Only For Ontario Customers
An announcement posted by the exchange on Monday informed that the restriction was mandated by the Ontario Securities Commission (OSC). The stated regulatory agency is responsible for the administration and enforcement of securities legislation in Ontario. Recently, OSC clarified the application of its regulatory regime to digital currencies.
Earlier this year, new guidance was published by the securities regulator, which was purported to clarify on whether securities laws would also apply to crypto exchanges. In the guidance, the OSC states that the laws may be applicable to exchanges that facilitate commodity-like crypto-assets trading. The regulator explained:
“Platforms would not generally be subject to securities legislation if each of the following apply: • the underlying crypto asset itself is not a security or derivative; and • the contract or instrument for the purchase, sale or delivery of a crypto asset.”
BitMEX’ Ontario Restriction Becomes Effective Starting September
In order not to violate the OSC securities laws, the cryptocurrency derivatives exchange opted to seize support for the related customers entirely. Beginning September 1, the Ontario customers will no longer be able to place orders on the exchange. So, no new positions can be open by Ontario customers. Neither can they increase their current open positions after the stated date.
BitMEX warned in the report the open position from the Ontario customers must be closed before January 4, next year. Else, the exchange will be forced to close itself. Noteworthily, the announcement today applies to only Ontario residents, and not the entire provinces in Canada.