Canadian digital asset leader, WonderFi, has announced that its subsidiaries, Bitbuy and Coinsquare, have collectively surpassed CAD 1 billion (USD 736 million) in client cash and digital asset deposits. This represents a significant rise from the CAD 695 million (USD 512 million) reported in the previous quarter. The announcement also highlighted a 16% increase in monthly active users and a 54% spike in total trading volume for the platforms in November.
Regulatory Compliance and Mergers
Bitbuy and Coinsquare have made significant strides in regulatory compliance, an imperative aspect for Canadian cryptocurrency exchanges. Bitbuy became a fully regulated crypto exchange in November 2021, under the Ontario Securities Commission. Similarly, Coinsquare secured status as the first crypto exchange to become a brokerage by the Investment Industry Regulatory Organization of Canada (IIROC) in October 2022. The exchanges merged with the decentralized finance (DeFi) platform, WonderFi, in July 2023. This move was endorsed by Canadian entrepreneur Kevin O'Leary and resulted in a combined user base of 1.6 million Canadians.
Financial Stability and Growth
In the third quarter of 2023, WonderFi reported combined revenues of CAD 9.9 million (USD 7.3 million). The company also broke even with cash in October, demonstrating its financial stability amidst the volatile crypto market. The surge in client assets underscores the expanding influence of these exchanges in the Canadian cryptocurrency market.
Stringent Regulations and Market Position
Canadian regulators now require all crypto exchanges operating within the country to be registered or have a pending legal commitment for licensing. This move is aimed at enhancing the security and reliability of cryptocurrency transactions in Canada. Given their compliance with these stringent regulations, Bitbuy and Coinsquare are uniquely positioned to lead the market. As of February, Canadian regulators have also mandated the delisting of unapproved stablecoins, barring USD Coin (USDC). Following this, exchanges like Kraken and Coinbase delisted Tether (USDT) and other stablecoins for Canadian users.