Tether will be Delisted from Crypto.com in Canada, What’s Next?

Tether will be delisted from Crypto.com in Canada to satisfy updated crypto regulations

Tether will be delisted from Crypto.com: According to user reports circulating on social media on Jan. 10, cryptocurrency exchange Crypto.com recently emailed its Canadian customers, notifying them that Tether would not be supported as of Jan. 31. The firm stated that on that date, it will delist USDT and suspend all USDT transactions.

"Please take urgent action to review your USDT balance and take any necessary action (eg. withdrawal or conversion) before the effective date," it warned.

Customers are urged to review their USDT balances and take any necessary measures such as withdrawal or conversion before the delisting date. Failure to do so may result in retrieval fees for attempting to deposit USDT from external wallets post-suspension, and in some cases, fund retrieval may not be possible. The delisting also impacts trading and deposits/withdrawals of USDT on the Crypto.com App.

In August, Crypto.com announced that the Ontario Securities Commission had accepted the firm's pre-registration undertaking for operations in Canada. As part of regulatory requirements, cryptocurrency exchanges operating in the Canadian province of Ontario are prohibited from listing digital assets banned by the OSC, which includes USDT. Similarly, Coinsquare, a cryptocurrency exchange regulated by the Investment Industry Regulatory Organization of Canada (IIROC), currently does not list USDT as one of its available trading assets.

All USDT trading pairs, transactions, deposits and withdrawals will be delisted by 1 p.m. ET on Jan. 31, the email continues. All remaining USDT user deposits on the exchange after that time will be converted to Circle-issued USDC. Crypto.com's action comes as regulators around the world are increasing their scrutiny of centralized exchanges in the wake of the collapse of FTX and as competition between the top stablecoins grows.

The Canadian Securities Administrators (CSA), the country's top securities regulatory body consisting of regulators from 10 provinces and three territories, said last month it would strengthen its oversight over crypto exchanges by "expanding existing requirements" for trading platforms operating in the country. The CSA said that it "continues to monitor and assess the presence and role of stablecoins in Canadian capital markets," according to a press release.

As the second great stablecoin war heats up, Tether's USDT appears to be falling behind the curve. Since the collapse of FTX, rival stablecoin USDC has been the preferred choice for most crypto users.

According to on-chain data from Glassnode, USDC has been averaging over $12.5 billion more in transfer volume per day than USDT and five times that of USDT since October. The decline in USDT volumes comes amidst criticism of auditing and a less-transparent reserve.

As per Tether's representative, Canada has made a fast decision. Whereas any nation should consider all the options available with an open mind before execution. Having a "fair, open and forward-looking approach" will only encourage the financial growth of the country.

The spokesperson also mentioned delisting Tether in Canada is not making a big impact on the token as they don't consider Canada to be their core market. USDT is 1st stablecoin in the CMC stablecoin category. Additionally, Tether solely has a $66 B market capitalization with an average US$23 billion trading volume in 24 hours.

Crypto.com's decision to delist USDT comes as regulators in Canada look to tighten their reins on centralized exchanges in the wake of the collapse of FTX.