Binance is exiting Canada, after a long, tumultuous journey that has included spats with regulators, pledges to stay and a pancake breakfast at the Calgary Stampede. Here’s what you need to know:

What’s happening: The world’s largest crypto-trading platform said in a tweet Friday afternoon that securities regulators’ recent guidance about stablecoins and limits on how much crypto users can buy make “the Canada market no longer tenable for Binance at this time.” Canadian users will receive an email about how the decision will affect their accounts, the tweet said. Binance spokesperson Nazmul Islam declined to comment on whether Binance Canada staff will lose their jobs.

Why it matters: Binance is the third most popular crypto-trading platform in Canada, used by 31 per cent of crypto holders in the country, according to a September 2022 survey by the Ontario Securities Commission. Binance and its Chinese-Canadian CEO Changpeng Zhao have grown their public profiles since the collapse of rival FTX in November, with Binance quick to take on the mantle of would-be rescuer of the troubled sector.

The context: Binance has had a contentious relationship with regulators around the world and Canada is no different. Since securities regulators here began their crackdown on unregistered crypto-trading platforms in the spring of 2021, Binance exited Ontario, then entered into a spat with the Ontario Securities Commission that ended in a legally binding commitment to cease trading in the province. The company maintained that it was committed to Canada, incorporating in Alberta and announcing plans to launch a Canada-specific platform as recently as March 31. Binance Canada CEO Lawrence Truong left the company last month.

Ilana Kelemen, a spokesperson for the Canadian Securities Administrators (CSA), an umbrella organization for the provincial regulators, said in an email that, while the organization does not comment on individual business decisions, its position on crypto platforms “is in line with its duty to balance the protection of Canadian investors with the creation of an environment where innovation and business can thrive.” 

The winners and losers: Brian Mosoff, CEO of Ether Capital and a well-known figure in the Canadian crypto industry, said Binance’s Canadian competitors have an opportunity to pick up some market share. “This is an opportunity. That’s great for our homegrown businesses,” he said. On the other hand, he said the decrease in competition may result in higher fees and less choice for crypto customers.

Not all large international crypto platforms: Binance’s statement highlighted that it is joining “other prominent crypto businesses” in exiting Canada amid the regulatory crackdown. It’s true that some international platforms left the country after the CSA gave offshore crypto platforms a 30-day window in February to submit an agreement to follow certain rules while pursuing full registration. But big name platforms that have opted to spend the time and money to stay include Coinbase, Kraken and Gemini. “Binance is in the minority in respect to this decision to leave Canada,” said Matthew Burgoyne, co-chair of the digital assets and blockchain group at Osler, Hoskin & Harcourt in Calgary. In an emailed statement, Kraken’s managing director for Canada Mark Greenberg said: “We want Canadians to know Kraken remains deeply committed to Canada. It is for individual companies to make informed decisions on whether they want to play by the stated rules of the game, or leave.”