Canada's CIRO excludes crypto funds from reduced margins
The Canadian Investment Regulatory Organisation (CIRO) announced on February 5, 2025, that cryptocurrency funds will not be eligible for reduced margin rates.
This decision stems from ongoing concerns over volatility, liquidity, and regulatory uncertainty in the cryptocurrency space.
The ruling means that investors will face higher costs when leveraging crypto positions compared to traditional assets like stocks or ETFs.
CIRO's quarterly List of Securities Eligible for Reduced Margin (LSERM) excluded cryptocurrency funds "until further notice."
As a result, investors trading crypto funds will have to maintain higher collateral, which increases the cost of leveraging crypto positions.
Without reduced margin rates, crypto funds are more vulnerable to forced liquidations during market downturns.
CIRO's criteria for reduced margin eligibility include price volatility measures, liquidity requirements, and market capitalisation thresholds.
Eligible securities must demonstrate a price volatility margin interval of 25% or less and maintain a market value of at least CA$2 per share.
Liquidity requirements include a public float value exceeding CA$100 million and an average daily trading volume of at least 25,000 shares each month.
Securities must also be listed on a Canadian exchange for at least six months to be eligible.
For those listed for less than six months, CIRO requires a market value greater than CA$5 per share, a dollar value of public float greater than CA$500 million, and operation in an industry sector known for low price volatility.
CIRO's decision highlights the continued skepticism among financial regulators regarding digital assets, prioritising stability over increased access to leveraged crypto trading.
For fintech startups, this ruling could serve as a double-edged sword, as while increased compliance might build trust, it may also present challenges to innovation.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Ethereum Classic ($ETC) Eyes a 510% Breakout Rally
Ethereum Classic could surge over 510% to $127.65 as a major breakout pattern emerges.Why the $127.65 Target MattersShould You Pay Attention?

Doginme Made Early Buyers Rich—Now Arctic Pablo Coin Is Leading the Next Meme Coin Gold Rush
While Doginme showed how fast gains can arrive in meme markets, Arctic Pablo Coin is showing how they can be structured, incentivized, and sustainable.Doginme: The Meme Token That Ran With the Big DogsArctic Pablo Coin’s 66% APY: The Meme Coin Presale With Real UtilityIceberg Isle and the Numbers That Matter: $0.000125 Entry, 6,300% ROIArctic Pablo Coin Is Built for the Long Run: Why It Belongs Among the Top New Meme Coins for Exponential Returns

Goldman Sachs Increases Bitcoin ETF Holdings, Surpasses BlackRock

Ethereum’s Rise to $2.5K Sparks Renewed Altcoin Interest

Trending news
MoreCrypto prices
More








