DigiFinex Receives Crypto Exemption License to Operate in Canada

Summary:
• DigiFinex has scored big as the regulatory environment tightens in Canada, as epitomised by Binance's exit earlier this month.

DigiFinex, the cryptocurrency exchange, has received approval from the Canadian regulator (the Alberta Securities Commission and other provinces granting reciprocal recognition) based on the Pre-Registration Undertaking (“PRU”) exemption.

The company says it reached the PRU after extensive and in-depth negotiations with the regulator. DigiFinex’s acquisition of this license satisfies a critical legal criterion for doing business as a dealer platform in Canada for those involved in the cryptocurrency market.

The exchange now has the legal right to conduct business in Canada under the PRU it negotiated with the regulator. This opens the door for residents of Canada to make use of DigiFinex’s platform to buy and sell cryptocurrencies.

The journey to license acquisition

DigiFinex is one of a select few operators with a clear path and timeframe to gaining final clearance from the Canadian government in the coming months, thanks to the regulator’s March 2023 announcement of the company’s PRU. A key requirement of the PRU is for the company to implement comprehensive anti-money laundering and countering the financing of terrorism measures.

The regulator also requires proper security measures to be put in place and kept up to date in order to safeguard the assets and personal information of investors. DigiFinex additionally must make sure it has solid risk management practices in place to prevent fraud and market manipulation.

DigiFinex’s focus on compliance and its implications

The Canadian regulatory market has recently tightened, with the rules proving too stringent for the world’s largest crypto exchange Binance, which quit the market in mid-May. The Canadian market has long been a top priority for DigiFinex. Recently, the firm began working with Qualified Custodian Tetra Trust, the only trust business in Canada authorised to cover digital assets. The company took the action to improve accessibility to an appropriate custodian option.

Tetra’s partners have extensive client asset crime indemnity, which is covered by a syndicate led by UK’s insurance giant Lloyds. More Canadian investors and traders will likely flock to DigiFinex since it, along with other licensed dealer platforms in Canada, ushers in a new era of safety for their financial holdings.

DigiFinex also says it is dedicated to worldwide compliance operations, which it does by cooperating closely with authorities all around the world to satisfy relevant regulations. The PRU exemption-based license is a major accomplishment for DigiFinex because it demonstrates the company’s commitment to protecting its customers.

Regulation is becoming increasingly important in the cryptocurrency industry, and the new regulatory framework emphasises the need of players working together with regulatory agencies to provide a fair and secure trading environment.