Cryptocurrencies in Canada: Authorities impose $30,000 purchase limits on altcoins

According to the new terms and conditions of use of the Newton cryptocurrency exchange platform, Canada limits investments to $30,000 per year. Although it does not concern all assets and all provinces of the country, this news raises questions about the freedom to dispose of its finances.

In Canada, the law limits investment in cryptocurrencies

Depending on the country where you are, we sometimes complain about the regulation of cryptocurrencies, but in Canada, the laws sometimes take the form of restrictions. Indeed, according to the new general conditions of use of Newton, a local exchange, investors have a limit on all their investments of 30,000 Canadian dollars per year.

We’re excited to finally announce our registration with the Ontario Securities Commission (OSC) and the securities regulatory authorities in all Canadian provinces, Yukon, and Northwest Territories. pic.twitter.com/8zx8UJy2DE

— Newton (@newton_crypto) August 16, 2022

However, this measure has some subtleties. For example, the following assets are not affected by these limits:

• Bitcoin (BTC);
• Ethereum (ETH);
• Litecoin (LTC);
• Bitcoin Cash (BCH).

Similarly, all the provinces of the country are not housed in the same boat. Thus, the ones below are not affected:

• Alberta;
• British Columbia ;
• Manitoba;
• Quebec.

Newton users must complete a questionnaire to judge their knowledge of cryptocurrencies. In case of sufficient knowledge, they will have access to the platform, and this limit of 30,000 dollars will be reset on each anniversary date of answering the questionnaire.

Note also that the “latent consumption” of this limit is variable. That is to say that if a user has for example purchased 10,000 dollars of SOL, he will logically have 20,000 dollars of “credit” left. But if he resells $5,000, that credit will be readjusted to $25,000. It should also be understood that it is not 30,000 dollars per altcoin, but indeed on all the assets, except those previously mentioned.

Exchange compliance

These measures actually meet the guidelines of the Ontario Securities Commission (OSC), as well as the Canadian Securities Administrators (CSA).

In order to remain compliant to continue operating on Canadian soil, regulators also require trading platforms to make a pre-registration commitment. This allows cryptocurrency exchanges to certify their willingness to comply with the rules in force in Canada. Crypto.com has already complied with these injunctions.

Although many investors will not really be penalized by these restrictions, it still raises questions about the freedom to dispose of one’s finances. Indeed, this is an additional argument for turning to self-care.