Bybit and KuCoin will have to pay over $4 million in fines, as The Ontario Securities Commission (the OSC) announced it will be issuing financial penalties for violating securities laws.
Same Violation, Different Outcomes
Bybit was the only of the two accused parties that “maintained an open dialogue.” The company also paid the expenses of the investigation, which were around $7,000. However, both Bybit and KuCoin are charged with the same violations: “operating unregistered crypto asset trading platforms.” But in spite of that, the outcome is different for KuCoin.
KuCoin, the company that has two headquarters, one of them in the Republic of Seychelles as Mek Global Limited, and the other one in Singapore as PhoenixFin Pte Ltd, has been banned from operating in the Ontario province: “Foreign crypto asset trading platforms that want to operate in Ontario must play by the rules of face enforcement action,” says Jeff Kehoe, the Director of Enforcement at the Ontario Securities Commission. Moreover, KuCoin will have to pay a $1.6 million penalty.
Bybit Gets a Settlement Deal
On the other hand, Bybit did provide the requested information and was compliant in the court process. Furthermore, Bybit promised not to accept any new customers in the Ontario region and not to offer any new products or services to the existing clients in the region. Bybit had to pay $2.5 million in legal proceedings and fines, but it is likely that the company will be able to operate in Ontario once the issue is fully resolved.
The trouble started when OSC issued a warning on March 29th, 2021, that all of the crypto platforms operating in Ontario will have to get in touch with the OSC or face enforcement actions. The deadline for this was April 19th, 2021, and niether of the two aforementioned companies managed to do so. Moreover, the OSC also created a page with the full list of approved crypto companies that are allowed to operate in Ontario.