Canadian Investment Regulatory Organization Excludes Crypto Funds from Margin Rate Reduction
YM Lee
Summary
- The Canadian Investment Regulatory Organization has announced that crypto funds are excluded from margin rate reductions.
- CIRO cited the volatility, liquidity, risk, and regulatory uncertainty of crypto funds as reasons for this decision.
- As a result, crypto fund investors will need to maintain higher collateral ratios, increasing the risk of forced liquidation during market downturns.
The Canadian Investment Regulatory Organization (CIRO) has excluded crypto (cryptocurrency) funds from qualifying for margin rate reductions.
According to a report by Cointelegraph on the 6th (local time), CIRO stated, "Crypto funds cannot qualify for margin rate reductions due to their volatility, liquidity, risk, and regulatory uncertainty."
As a result, investors trading in crypto funds will need to maintain higher collateral ratios, which could increase the likelihood of forced liquidation during market downturns.
YM Lee
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