Canada Targets Unregistered Crypto Exchanges in Major Laundering Case
- Canada seizes over $56M from unregistered exchanges impacting major cryptocurrencies.
- RCMP dismantles TradeOgre as KuCoin receives fines.
- Global regulatory tightening shifts market towards compliance.
Unregistered crypto exchanges in Canada, including TradeOgre and KuCoin, have facilitated large-scale money laundering, prompting enforcement actions and record fines, with significant asset seizures impacting cryptocurrencies.
These regulatory gaps expose the Canadian crypto market to illicit activities, leading to heightened scrutiny, market disruptions, and a push for compliance and transparency in cryptocurrency operations.
Unregistered crypto exchanges in Canada, including TradeOgre and KuCoin, face enforcement actions as RCMP seizes over $56 million in assets.
The crackdown highlights major regulatory gaps, catalyzing further scrutiny and significant market reactions affecting major cryptocurrencies.
RCMP Seizes $56 Million in Crypto Crackdown
Unregistered crypto exchanges in Canada opened avenues for extensive money laundering. The Royal Canadian Mounted Police (RCMP) executes record seizure of more than $56 million against entities, especially impacting TradeOgre and KuCoin.
TradeOgre has been dismantled following an RCMP investigation, while KuCoin, under regulatory examination, faces a CAD 19.6 million fine for unregistered operations and AML breaches.
Liquidity Issues Emerge Post-Crackdown
The actions launched by the Canadian authorities led to immediate liquidity deficits in the affected exchanges, triggering significant drops in Total Value Locked (TVL) and user withdrawals.
Sarah Paquet, Director and CEO, FINTRAC, said, “Canada’s anti-money laundering and anti-terrorist financing regime is in place to protect the safety of Canadians and the security of Canada’s economy. FINTRAC works with businesses to help them understand and comply with their obligations under the Act. We are also firm in ensuring that businesses continue to do their part and we will take appropriate actions when they are needed.”
This has financial, social, and business implications, emphasizing the gaps in the global crypto regulatory framework and highlighting the cross-border collaboration needed to address them effectively.
KuCoin’s Fines Reflect Global Regulatory Approach
Similar enforcement actions against unregistered exchanges have occurred globally. For instance, KuCoin was previously fined in Ontario, showcasing consistent regulator vigilance towards crypto operations.
Based on recent patterns, heightened regulatory measures are expected to persist, prompting shifts towards compliance. This reflects ongoing industry adjustments needed for adapting to increased scrutiny.
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