Canadian users will be required to record significant transactions made on other exchanges.
According to a warning provided to Coinbase customers in Canada, users may soon be obliged to submit the identity of beneficiaries of significant transactions.
“Effective April 4, Coinbase will implement some adjustments mandated by Canadian legislation,” the letter states.
The notification continues, stating that for transfers above 1,000 Canadian dollars (about $800), Coinbase is “mandated by law to request information about the receiver of the transaction.” The recipient’s name and address must be supplied. This law seems to apply to corporate transactions rather than personal transactions, since it is only applicable when the receiving party is a financial company, money service firm, or crypto exchange.
Ryan Sean Adams of Bankless received a copy of the letter emailed to consumers and published it on Twitter.
Regulations Adapt to Regulatory Change
According to Coinbase, these adjustments are being implemented in response to the Criminal proceeds (Money Laundering) and Terrorist Financing Act (PCMLTFA).
These laws, which took effect in June 2021, compel financial institutions to maintain records of virtual currency transactions worth $1,000 or more. Coinbase’s decision to disclose the regulation this week is likely motivated by the fact that the Canadian regulatory agency FINTRAC will begin conducting compliance assessments in April.
Similar record-keeping restrictions have been in place in the United States for many years under the Bank Secrecy Act. Coinbase’s support sites indicate that company conforms with such standards, albeit the reporting level under American legislation is unknown.
Canada Is Getting Noticed
Canada has recently been a point of contention in the cryptocurrency world. The Canadian government garnered notice in February when it directed exchanges to ban addresses associated with the convoy protesting COVID-19 restrictions.
In a related development, Binance completely ceased operations in Ontario this month owing to an inability to reach an agreement with authorities.
There seems to be no connection between any of these judgments. The decision to ban crypto addresses was taken in accordance with the provisions of the now-repealed Emergencies Act. Binance’s first public offering was registered with the Ontario Securities Commission and was confined to a single jurisdiction.
Meanwhile, Coinbase’s actions are a result of the gradual implementation of a statewide reporting requirement over the last year.
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