With the Canadian Investment Regulatory Organization (CIRO) membership deadline rapidly approaching, Canadian Trading Platforms (CTPs) are hurrying to ensure that their business practices align with the required legal standards.
It is worth noting that the registration process remains crucial for any trading platform operating within the North American nation. Therefore, it underscores the significance of the registration and why trading platforms seem to be rallying around eligibility.
Earlier Notice for CIRO Membership in 2021
For context, about three years back, particularly in March 2021, the Canadian Securities Administration (CSA) and the Investment Regulatory Organization of Canada (now CSA) released a notice mandating all CTPs operating in the country to register as investment dealers under CIRO.
The 2021 announcement disclosed that CTPs were temporarily allowed to operate as restricted dealers. Additionally, they were permitted to work towards attaining full membership within a two-year interval.
New Announcement, Following Regulation Window Elapse
In a recent statement, the CSA and CIRO sent out another notice, reminding the CSA about the necessity of the previous commitment. Interestingly, it advised them to prioritize their registration process, given that the temporary period has elapsed.
Part of the notice read thus, “Given the time that has elapsed, CSA members expect that CTPs would have thoroughly assessed and understood the requirements for registration as investment dealers and CIRO members and be working closely with CIRO on their applications.”
Implications For Exchanges
The notice has placed CTPs operating in Canada in a chaotic state, with many hurrying to meet the deadline. Coinsquare has completed all requirements and currently owns a CIRO membership. On the other hand, a few different platforms failed to meet the deadline. Consequently, they have opted to withdraw from the market and seek options elsewhere.
Aside from the regulators’ action aiming to enhance compliance, particularly after the occurrences that led to the implosion of several blockchain industries, it is also creating a secured market for Canadian investors.
Meanwhile, CIRO has also rolled out a Readiness Questionnaire to assist exchanges in assessing their preparedness levels for CIRO membership. In addition, the assessment form ensures that only qualified trading platforms that meet every requirement will receive CIRO membership admission.