A New Frontier: Coinbase's Canadian Expansion and Ongoing Challenges in the U.S.

A New Frontier: Coinbase’s Canadian Expansion and Ongoing Challenges in the U.S.

Updated: 15 August 2023

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Coinbase has seized an opportunity to grow in the Canadian market, despite facing legal challenges in the U.S. The crypto exchange’s expansion into Canada is in collaboration with financial services firm Peoples Trust Company, and is a strategic move to make cryptocurrency more accessible to Canadians.

O Canada.
America’s friendly hat.

Effective today, you can all now easily buy, sell, and trade crypto on Coinbase.

Welcome, neighbours.

Read more: https://t.co/3BZ09zj0ll pic.twitter.com/K5HRa69HCZ

— Coinbase 🛡️ (@coinbase) August 14, 2023

To further this accessibility, Coinbase has added the Interac e-Transfer option, a feature highly requested by Canadian users. The company’s press release stated, “Interac availability was the most requested feature by Canadian users, and today’s news demonstrates Coinbase’s plan to build a platform that is for Canadians, by Canadians. Depositing funds to Coinbase using Interac is free and almost instant. In the last month, over 50% of deposits have been made through Interac e-transfer.”

Today, we proudly announce a pivotal milestone in our international expansion strategy – our official launch in Canada.

Additionally, Canadians can explore Coinbase One through a 30-day complimentary trial, offering advantages like zero trading fees, enhanced staking rewards, and priority support.

Coinbase acknowledges Canada’s importance by considering it a high-priority region. The country ranks as the second-most crypto-aware among Coinbase’s international markets, and an Ontario Securities Commission survey reveals that over 30% of Canadians plan to invest in cryptocurrency within a year. “This presents a significant opportunity for growth in the Canadian market,” the company highlighted.

Investing in Canada’s prospering tech and developer ecosystem is integral to Coinbase’s approach. Through Coinbase Ventures, they’ve nurtured startups that drive innovation in various fields like risk assessment and asset management. Key Canadian portfolio partners include Dapper Labs, Minerva AI, Axelar, Horizon Blockchain Games, and Zapper. With almost 200 full-time local employees, Canada is Coinbase’s largest tech hub outside the U.S., underscoring their commitment to the growing crypto community in the country.

Regulatory Challenges and Opportunities

While Canada represents a significant growth opportunity, Coinbase’s U.S. operations have faced challenges, especially from regulators like the Securities and Exchange Commission (SEC). There has been increased pressure on the company this year for international expansion. Interestingly, in May, Binance withdrew from the Canadian market, citing the country’s regulatory guidance as a hindrance to its continued operations.

In May, using a license from the Bermuda Monetary Authority, Coinbase launched the Coinbase International Exchange, catering to institutional users outside the U.S. The exchange offers trading in perpetual futures, accounting for nearly 75% of global crypto trading volume last year. “Building out a global perpetual futures exchange for digital assets will help support an updating of the financial system by making Coinbase’s trusted products and services more accessible to users of digital assets who live outside of the U.S.,” the company expressed at that time.

Following the international exchange‘s launch, the SEC sued Coinbase, contributing to a near 70% drop in transaction volume. This lawsuit is part of a broader regulatory crackdown on the crypto industry.

Coinbase’s Canadian expansion and investment in the tech ecosystem affirm its desire to foster innovation and broaden accessibility. However, it must navigate complex regulatory landscapes and ongoing legal battles in the U.S. The situation emphasizes the dynamic nature of the crypto industry, where opportunities and challenges often coexist. In spite of all of this, Coinbase expresses unabashed optimism over its Canadian expansion:

Coinbase’s Canadian expansion heralds a new era of possibilities for crypto enthusiasts across the nation. As Canadians eagerly embrace the potential of cryptocurrencies, our foray into the Canadian market stands as a pivotal milestone in our mission to bring the most trusted name in crypto around the world, revolutionize the financial landscape and empower individuals with economic freedom on a global scale.