The Canadian cryptocurrency space was just dealt another blow with the news that a Vancouver-based exchange has just bit the dust, having had an unfortunate run-in with local regulators.
This marks the latest collapse of a relatively well-known Canadian Bitcoin exchange in the past year. Ouch.
Einstein Exchange Seized by BCSC
Revealed in a press release published on Monday morning, the British Columbia Securities Commission (BCSC) has recently made a move to “protect customers” of Einstein Exchange, a crypto-asset exchange headquartered in Vancouver.
The move: to gain an order from the Supreme Court of British Columbia allowing an interim receiver to “preserve and protect any assets of Einstein Exchange.” The Court granted the order to auditing company Grant Thornton Limited, as an official document from November 1st indicates. Grant Thornton Limited now has the authority to take control of Einstein’s assets and properties, along with the ability to enter any of the exchange’s premises if deemed necessary to protect customers.
CoinDesk reports that this move comes after the exchange told customers that it planned to close up shop by the end of 2019 or by the end of next January. The thing is, court filings have indicated that the exchange owes some $12.4 million worth of assets to its customers, hence the recent action taken to protect consumers. The BCSC press release hinted at this matter:
The materials filed in court noted that the BCSC had received numerous complaints about customers being unable to access their assets on Einstein Exchange, and on October 31 had been told by a lawyer representing the trading platform that it planned to shut down within 30 to 60 days due to a lack of profit.
The BCSC even went as far as to say that it, alongside its counterparts across Canada, advises “Canadians to exercise caution when buying or selling any crypto-assets due to various risks, including the loss of some or all of their investment.”
As aforementioned, this is the latest collapse of a local cryptocurrency trading platform in a matter of months. Previously, QuadrigaCX’s operations came to a screeching halt after its chief executive purportedly died in India to Crohn’s disease.
While the details of this case are still up in the air, the consensus seems to be that when QuadrigaCX’s chief died, the remaining employees were unable to access dozens of millions of dollars worth of Bitcoin, Ethereum, and Litecoin owed to clients, leading to forced closure of the platform.
Not All Hope is Lost for Canada’s Bitcoin Ecosystem
While formal Canadian crypto exchanges are seemingly on their way out the door, there are other mediums in which Canadian investors can gain exposure to Bitcoin.
As reported by Blockonomi previously, Canadian investment fund manager 3iQ has just been given a regulatory stamp of approval from the Ontario Securities Commission (OSC) for the so-called “The Bitcoin Fund.” The “closed-end” fund will be available to be traded on a major Canadian stock exchange by retail investors by the end of 2019, according to The Province. The fund will purportedly be available to be bought and sold via traditional and discount brokers.
It has also been said that shares of The Bitcoin Fund will be eligible to be a part of Canadian registered retirement savings plans and tax-free savings accounts.
3iQ’s fund is evidently a step in the right direction, but with two crushing blows dealt to existing Canadian crypto investors, the nation’s interest in Bitcoin is likely to suffer — in the short term anyway.