Cryptocurrency exchange Crypto.com will no longer facilitate transactions involving Tether in Canada and plans to delist the largest stablecoin by market capitalization for customers in the region.
The Crypto.com spokesperson mentioned, “Crypto.com has delisted USDT for users in Canada in accordance with instructions from the Ontario Securities Commission (OSC) as part of our pre-registration undertaking for a restricted dealer license.”
As images of the delisting notification started to emerge on Reddit and Twitter on Tuesday, the exchange also contacted Canadian users about the policy change through email.
The notice stated Crypto.com’s support of Tether will end on January 31, without specifically stating users in Canada would only be affected, prompting confusion on behalf of some on social media.
The exchange also warned users that all trading, deposits, and withdrawals will not be facilitated after the deadline. “Please take urgent action to review your USDT balance and take necessary action,” the notice highlighted.
Any USDT balances that are still available will be immediately converted to Circle’s USD Coin, another stablecoin that matches the value of the dollar. The exchange further said that it might not be feasible or cost some money to recover USDT deposits made after the cutoff.
According to data from CoinGecko, Tether is the third-largest digital asset by market capitalization and the biggest stablecoin in the cryptocurrency space, with a total market value of almost $66 billion. USD Coin is currently second among stablecoins at nearly $43 billion in total value but gained ground against Tether last year.
Stablecoins play an integral role in the crypto ecosystem, giving people an option to swap cryptocurrencies for a more stable store of value without converting digital assets into so-called fiat money, such as the U.S. dollar.
Crypto.com’s decision to delist Tether follows regulatory clarification from the Canadian Standards Association (CSA) in December. The update was posted to the Ontario Securities Commission’s website.
The blog post read, “The CSA continues to monitor and assess the presence and role of stablecoins in the Canadian capital market. As a result of this ongoing work, the CSA is of the view that stablecoins, or stablecoin arrangements, may constitute securities and/or derivatives.”
The blog post also emphasized that cryptocurrency exchanges registered in Canada are prohibited from permitting Canadian clients to trade or obtain exposure to, any crypto asset that is itself a security and/or a derivative.