Kraken’s Success in Canada Amid Rivals’ Departures
Kraken, a well-known crypto exchange, has experienced a surge in customer deposits and mobile app downloads in Canada. Following the announcements of departure from rival exchanges Binance and OKX. In the weeks following Binance’s announcement in early May, Kraken witnessed a notable 25% increase in customer deposits in the country. Similarly, after OKX revealed its plans to leave in March, Kraken observed a fivefold increase in downloads of its mobile apps for Canadian clients. These statistics were shared by a Kraken representative with CoinDesk via email. Discover how Kraken’s Strategic stay in Canada pays off as customer deposits surge after rivals’ departures and success in the Canadian market
The exodus of major crypto exchanges from Canada was prompted by the country’s tightened regulatory framework for digital asset trading earlier this year. Alongside Binance and OKX, other prominent crypto firms, including Paxos, Blockchain.com, Deribit, and most recently Bybit, also announced their departures. However, Kraken and Nasdaq-listed exchange Coinbase have chosen to remain in Canada. Embracing the enhanced Pre-Registration Undertaking (PRU) introduced by the country’s regulators.
Kraken, which has been operating in Canada for over a decade. It is a registered money services business since 2019 and expressed its satisfaction with the Canadian regulatory approach. Mark Greenberg, the firm’s managing director for Canada, highlighted the alignment of certain aspects. Such as a strong emphasis on security for customer assets. However, he also acknowledged certain limitations on trading and margin as areas of concern.
One of the new provisions introduced by the Canadian Securities Administrators (CSA) for crypto exchanges. It is the requirement to hold a significant portion of client assets with a third-party custodian. Greenberg mentioned that Kraken and other exchanges have committed to utilizing a third-party custodian. They are engaging in ongoing discussions with regulators regarding this requirement. The objective is to ensure the safety and security of clients’ assets. Also, protecting them from potential risks like rug pulls and other fraudulent activities.
Kraken’s positive reception in Canada and its decision to comply with the regulatory framework demonstrate. Its long-term commitment to the country’s market. With over 250 staff members dedicated to serving Canadian clients, Kraken values the opportunities provided by the Canadian regulatory landscape. Despite some areas that may require further dialogue. The company’s ability to adapt and operate within the regulatory guidelines sets an example for the industry. Prioritizing the protection of customer assets while fostering growth in the Canadian crypto ecosystem.