Starting a Crypto Exchange in Canada: A Guide by Substance Law

Welcome to Substance Law, your trusted source for legal guidance in the realms of cannabis, psychedelics, vaping, liquor, tobacco, natural health products (NHPs), food and drugs, money service business, NFTs, and crypto. Today, we’ll delve into the intricate process of starting a crypto exchange in Canada, a country known for its progressive stance towards digital assets.

Understanding the Regulatory Landscape

Before venturing into the realm of cryptocurrency exchanges, it’s imperative to grasp the regulatory framework governing such activities in Canada. The regulatory landscape for crypto exchanges in Canada is primarily overseen by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) and provincial regulators such as the Ontario Securities Commission (OSC), the British Columbia Securities Commission (BCSC), and the Autorité des marchés financiers (AMF) in Quebec.

Additionally, in Canada, cryptocurrency exchanges may be subject to securities laws if they offer tokens deemed as securities. Therefore, it’s crucial to navigate through both federal and provincial regulations to ensure compliance.

Key Steps to Launching a Crypto Exchange in Canada

1. Obtain Necessary Licenses and Registrations

Depending on the nature of your crypto exchange and the services it offers, you may need to obtain relevant licenses and registrations. This could include registering as a money services business (MSB) with FINTRAC and complying with securities regulations if your platform deals with security tokens.

2. Develop a Compliance Framework

Compliance is paramount in the crypto space, given its susceptibility to money laundering and other illicit activities. Establish robust Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures to mitigate risks and ensure regulatory adherence.

3. Implement Stringent Security Measures

Security breaches can be catastrophic for a crypto exchange, leading to loss of funds and damage to reputation. Invest in state-of-the-art cybersecurity measures, including encryption, multi-factor authentication, and cold storage for digital assets.

4. Partner with Reputable Banking Institutions

Establishing banking relationships is crucial for facilitating fiat-to-crypto transactions on your exchange. Partner with reputable banking institutions that are open to servicing crypto businesses, as navigating the banking sector can be challenging in this industry.

5. Draft Comprehensive Terms of Service and Privacy Policies

Ensure transparency and protect your users’ interests by drafting comprehensive terms of service and privacy policies. Clearly outline the rights and responsibilities of both users and the exchange, as well as data handling practices to comply with privacy laws.

Consult Substance Law for Expert Guidance

Embarking on the journey of launching a crypto exchange in Canada can be complex, requiring meticulous attention to legal and regulatory details. At Substance Law, we specialize in providing comprehensive legal counsel to businesses operating in the crypto and blockchain space.

With our deep understanding of Canadian regulations and industry best practices, we can guide you through every step of the process, from obtaining licenses to drafting compliance policies and navigating regulatory challenges.

For more information on how to start a crypto exchange in Canada, consult Substance Law today. Visit for insights from our expert legal team.


Starting a crypto exchange in Canada offers immense opportunities in a rapidly evolving industry. However, it’s essential to navigate the regulatory landscape diligently and ensure compliance with applicable laws and regulations.

By partnering with a knowledgeable legal team like Substance Law, you can mitigate risks, foster trust among users, and position your exchange for long-term success in the dynamic world of cryptocurrency.

Remember, informed legal counsel is key to unlocking the full potential of your crypto venture. Contact Substance Law today and embark on your journey to establishing a compliant and thriving crypto exchange in Canada.