Canada in a surprising move has put brakes on the amount of crypto one can buy in a year. The new rules have set an annual limit of $30,000 and investors cannot trade beyond this limit. The restrictions will be effective in nine provinces which include Northwest Territories, Yukon, Prince Edward Island, Saskatchewan, Ontario, Nunavut, Nova Scotia, New Brunswick and Newfoundland. However, the regulation will not be applied for four crypto assets and they are Bitcoin, Ethereum, Litecoin, and Bitcoin Cash
Why Restrict Crypto
The nine provinces will enforce the latest rules. The rules have been brought to protect the Crypto Community from the extreme volatility which is synonymous with crypto currencies. Four provinces will not be affected by the new regulations and they are Alberta, British Columbia, Quebec, and Manitoba provinces.
The new regulations have set the maximum limit as $30,000 will be reviewed every 12 months. The regulations can be exempted in certain circumstances depending upon the type of investor. It will include factors such as the income and net worth of the investor and they can buy a higher amount of crypto.
Action Has Been Decried By The Crypto Community
Canada’s action has been decried by the crypto community. Founder of Bankless, David Hoffman stated his frustration and astonishment at Canada’s move. Also Hoffman talked about the possibility of DeFi protocols like Uniswap buy the non-restricted crypto assets and then get the restricted ones. It is not clear if such actions will also come under the new regulations.
Vitalik Buterin, the creator of Ethereum is happy that many Ethereum proponents are against such move. The new regulations do not put any limit on investing in Ethereum. Therefore, Ethereum will have a competitive edge against its competitors. Despite this many Ethereum Crypto Community have spoken against the move.
Latest reports reveal that Canada’s new regulation have already been adopted by Bitbuy and Newton, two of Canada’s biggest exchanges