When Canadian exchange Cavirtex closed its doors in February, there was a lot of speculation about the reasons it shut down, but few expected the exchange to come back to life. Cavirtex shut down amid security concerns after a major breach.
Now, New York-based digital currencies exchange Coinsetter is expanding into the Canadian market by buying previously closed exchange Cavirtex for close to $2 million, according to Fortune Magazine. Coinsetter, which specializes in institutional trading for investment firms, is confident it can win back all of Cavirtex’s old customers in Canada and grow its presence there.
Cavirtex may have stiff competition in Canada
In a bold statement, Coinsetter CEO Jaron Lukasiewicz was quoted as saying there were currently no good exchanges for the Canadian market. In fact, he said, “Every single exchange that currently exists in Canada is very poor quality, it’s almost unbelievable…the other options in that market are very bad.”
After Vault of Satoshi and Cavirtex closed down earlier this year, Canadian exchange QuadrigaCX comfortably slipped into first place in the Canadian market.
Responding to comments by Lukasiewicz, Gerald Cotten, Founder and CEO of QuadrigaCX, told Bitcoin Magazine, “We welcome the additional interest in the Canadian digital currency space. We will work hard to continue providing the best trading experience for all of our clients.”
Regulations not really an issue
There was speculation at the time Cavirtex closed down that new federal regulations and a new set of regulations local to Quebec were factors in Cavirtex’s decision.
But Amber Scott, digital currencies specialist and Chief AML Ninja at Outlier Solutions had always said that she doubted that regulations by Canada or Quebec regulations were a factor in Cavirtex’s closing.
“I would say that Cavirtex took steps to be prepared for regulation relatively early on,” Scott told Bitcoin Magazine. I don’t expect that the Canadian regulatory environment was closely related to their temporary closure.”
Coinsetter is known more for wholesale rather than retail investing, working with investment firms and institutional traders to enable margin trading.
Jessie Willms is a planet earth based former government and political researcher and communications officer helping to document the FinTech revolution and its impact on traditional institutions and governments. You can follow Jessie on Twitter at @WILLMS_.