Decision in brief: Ontario Securities Commission v XT.com Exchange, Inter-Jurisdictional Enforcement Proceeding, Sanctions, March 6, 2025

XT.com Exchange and BZ Limited operate an online crypto asset trading platform, accessible from Canada, which offers various crypto asset products and programs to the public. The Tribunal administratif des marchés financiers du Québec decided that the respondents’ operation of their crypto trading platform violated Québec securities law by selling securities without being registered to do so and without filing a prospectus (a document that gives investors information about the investment) for those securities. The Québec Tribunal permanently banned the respondents from participating in Québec’s capital markets and ordered that they pay an administrative penalty of $2 million.

The OSC asked the Tribunal to ban the respondents from participating in Ontario’s capital markets based on the Quebec Tribunal’s decision. The respondents were not given a chance to respond to the application because of recent changes to Ontario securities law which streamlined the process for applications based on decisions made by other Canadian securities regulators.

The Tribunal decided to permanently ban the respondents from participating in Ontario’s capital markets. If the respondents had conducted the same activities in Ontario, it would have been a violation of Ontario securities law. The Tribunal decided that a permanent ban was needed to protect Ontario’s investors and capital markets.