Ndax is Now a Registered Investment Dealer and Marketplace

Ndax’s registration as an Investment Dealer, CIRO membership and recognition as a Marketplace operating as an ATS marked an important stage in the company’s regulatory development in Canada.

The registration followed Ndax’s Pre-Registration Undertaking in March 2023 and the regulatory process that followed. The terms and conditions applicable to Ndax’s registration were set out in a decision issued by Canadian securities regulators.

As a registered Investment Dealer and CIRO member, Ndax is subject to regulatory requirements applicable to its business, including requirements relating to compliance, financial reporting, capital and operations.

Ndax’s operational security, custody practices and insurance arrangements are separate from its regulatory registration. Registration establishes the regulatory framework under which Ndax operates, but it should not be interpreted as a guarantee of investment performance or protection against all risks. 

Investment Dealer registration brought Ndax within the regulatory framework applicable to investment dealers in Canada. Ndax is also a member of CIRO and operates a Marketplace as an Alternative Trading System.

As an Order Execution Only firm, Ndax executes transactions based on customer instructions and does not provide investment advice or recommendations. Customers remain responsible for making their own investment and trading decisions.

These regulatory designations describe different parts of Ndax’s operations:

1. Investment Dealer 
   Ndax is registered as an Investment Dealer under securities legislation in all provinces and territories of Canada.
2. CIRO Member 
   Ndax is a member of the Canadian Investment Regulatory Organization, the self-regulatory organization responsible for overseeing investment dealers, mutual fund dealers and trading activity on Canada’s debt and equity marketplaces.
3. Marketplace and Alternative Trading System 
   Ndax is recognized as a Marketplace operating as an Alternative Trading System, or ATS.
4. Order Execution Only 
   Ndax operates under an OEO model. It executes customer-directed transactions but does not provide investment advice or recommendations. 

CIRO and the Canadian Investor Protection Fund (CIPF) serve different purposes.

What is CIRO?

The Canadian Investment Regulatory Organization is the national self-regulatory organization that oversees investment dealers, mutual fund dealers and trading activity on Canada’s debt and equity marketplaces.

CIRO establishes and enforces regulatory requirements for its members and carries out functions related to market integrity, compliance and investor protection.

Ndax is a member of CIRO.

What is CIPF?

CIPF is separate from CIRO.

The Canadian Investor Protection Fund provides protection for eligible property held by clients of member firms if a member firm becomes insolvent, subject to CIPF’s Coverage Policy, limits and eligibility requirements.

Ndax is a CIPF member. Fiat currency held in customer accounts may be protected by CIPF’s Investment Dealer Fund in accordance with its Coverage Policy.

CIPF protection does not extend to crypto assets held in Ndax accounts. Crypto assets are also not eligible for protection from the Canada Deposit Insurance Corporation (CDIC).  

For current information about the scope, limitations and exclusions of CIPF coverage, refer to Ndax’s Registrations and Regulatory Disclosures and CIPF’s current Coverage Policy. 

Ndax’s Investment Dealer registration established additional regulatory requirements governing aspects of the company’s operations, compliance, reporting and customer relationships.

For users, the registration framework includes areas such as:

• Regulatory oversight: As a registered Investment Dealer and CIRO member, Ndax is subject to applicable regulatory requirements and oversight.
• Marketplace requirements: Ndax operates as a Marketplace through an Alternative Trading System and is subject to the applicable requirements governing that activity.
• Customer information and assessments: As part of the registration framework introduced at the time, customers were required to provide certain information and complete applicable assessments and disclosures.
• Order Execution Only trading: Ndax continues to operate under an Order Execution Only model. Users make their own decisions about whether and when to buy or sell crypto, while Ndax executes transactions according to customer instructions. Customers can independently review information about registered firms through CIRO’s public resources. 

The requirements below describe changes communicated as part of Ndax’s December 2024 registration transition. They should not be relied on as a statement of current requirements. Current policies, limits and requirements may have changed since this article was published.

At the time of the registration announcement, existing Ndax users were asked to complete or review several items when accessing their accounts, including:

• An appropriateness assessment
• Certain financial information related to applicable trading limits
• Updated policies and risk disclosures
• Updated documentation for certain existing API users

These requirements formed part of Ndax’s transition to the regulatory framework applicable to its Investment Dealer registration at that time.

The registration announcement also included changes to certain trading limits and customer classifications. Because regulatory and platform requirements can change, users should refer to current information available through their Ndax account and Ndax’s regulatory disclosures rather than relying on the historical limits described in the original announcement. 

Ndax’s December 2024 registration as an Investment Dealer, membership in CIRO and recognition as a Marketplace operating as an ATS represented an important regulatory milestone for the company.

This article documents that announcement and the changes communicated to users at the time.

For current information about Ndax’s Investment Dealer registration, CIRO and CIPF membership, Marketplace status, CIPF coverage and other applicable disclosures, visit our Registrations and Regulatory Disclosures page. Ndax’s current disclosure states that it is registered as an Investment Dealer under securities legislation in all provinces and territories of Canada, is a member of CIRO and CIPF, and operates under an Order Execution Only model.

Disclaimer: This article is for informational purposes only and reflects information relating to Ndax’s December 2024 registration announcement. It is not intended to provide investment, legal, accounting, tax or other advice and should not be relied upon as such. Information relating to regulatory requirements, trading limits, policies and protections may change over time. Please refer to Ndax’s current legal and regulatory disclosures for current information.