Newton and Bitbuy, two major cryptocurrency exchanges in Canada have imposed buy limits on cryptocurrencies.
CAD 30,000 Limit Imposed on Altcoin Purchases
The reports have confirmed that both exchanges have imposed annual purchase limits on the restricted cryptocurrencies. According to updates from sources, the limit has been imposed on Ontario-based investors.
The officials at both exchanges have confirmed that they have imposed limits on altcoin purchases due to tightened regulations. Most importantly, they wanted to protect consumers from the risks of investing in cryptocurrencies.
For this purpose, they have introduced a limit of 30,000 Canadian dollars that the investors in Ontario can spend annually for altcoin purchases.
Announcement by Newton
The cryptocurrency exchange based in Toronto announced that they have recently acquired registration from the Ontario Securities Commission.
After the registration, it was necessary for them to comply with the regulatory guidelines put in place by the Ontario Securities Commission (OSC).
In addition to the OSC, other regulatory authorities linked with securities have also authorized Newton to operate in the country. The exchange has been granted access to operate in different parts of territories and provinces in Canada.
Reason behind Implementation
The reason behind these implementations is to protect the investors interacting with the cryptocurrency industry.
In addition to protecting the investors, the aim is to educate them about the risks involved when interacting with cryptocurrency assets. They must also remain mindful of what kind of risks the cryptocurrency sector may incur.
According to the newly introduced regulations and limitations, investors in Ontario and other parts of Canada will have annual limitations on buying cryptocurrencies.
As per the exchanges, the max the investors can spend on the restricted cryptocurrencies on an annual basis is 30,000 CAD. This is the net buy limit for the altcoins but it is not applicable to certain cryptocurrencies.
These cryptocurrencies include Litecoin (LTC), Ether (ETH), Bitcoin Cash (BCH), and Bitcoin (BTC).
According to the guidelines, if an investor purchases any cryptocurrency other than the ones mentioned above, and sells it, the particular amount would be deducted from the annual limit.
Once the particular limit is reached, the user will not be authorized to purchase any more of the particular assets. The cycle would reset every 12 months, which would reset the limit to 30,000 CAD.
Newton to Operate as a Restricted Dealer
As announced by Newton on Wednesday, it will be operating as a restricted exchange and trading platform. This means that it will be offering services and facilities from the cryptocurrency sector that are regulated.
This way, the exchange will be able to make online trades much more convenient and easy to understand for investors in Canada.