In light of regulatory requirements Kraken has phased out the availability of margin trading for certain Canadian Kraken clients. Margin trading will remain available to Canadian clients that meet specific requirements, as described below. Canadian clients that do not meet these requirements have had their margin positions closed.
What are the requirements for certain Canadian clients to qualify as permitted clients?
Canadian clients who do not have Intermediate or Pro accounts will first need to get verified to at least the Intermediate level before having the opportunity to self-certify as a Permitted Client. All new Canadian Intermediate or Pro clients and all existing Canadian Intermediate or Pro clients will be asked to self-certify as to their Permitted Client status when they attempt to do a margin trade.
If you have previously self-certified and your Permitted Client status has changed or if you made an error in the self-certification process, please contact Support.
Two key ways to qualify as a Permitted Client under this definition are:
- For individual clients – You are required to beneficially own financial assets with a value that, before taxes but net of any related liabilities, exceeds CAD $5 million. This test focuses on net financial assets (assets minus liabilities) as opposed to gross assets. Financial assets include, for example, cash, stocks, bonds, mutual funds and cryptocurrencies. Financial assets do not include real estate. Beneficial ownership refers to financial assets that you own outright, as well as ownership through any trustee, legal representative, agent or any corporation or other legal entity which is wholly owned by you.
- For corporate clients – The company you represent must have net assets of at least CAD $25 million as shown on its most recently prepared financial statements. This test focuses on net assets (assets minus liabilities) as opposed to gross assets. Net assets include the value of real estate holdings, minus the amount of any mortgage or other indebtedness related to such real estate holdings. If you represent a company and the company doesn’t qualify as a Permitted Client under the CAD $25 million in net assets test, your company may qualify as a Permitted Client under one of the other categories of the Permitted Client definition. Please review the categories and contact Kraken support if the company you represent qualifies for at least one of them.
Additional information on Permitted Client status
- As a Canada client, it is your responsibility to understand the requirements to qualify as a Permitted Client under Canadian law. If you have any questions about whether you qualify as a Permitted Client, you should consult your legal advisor.
- Under the Terms of Service, you or the institution you represent is required to provide accurate and truthful information and promptly update your or its Kraken Account information. If you self-certify as a Permitted Client and your status changes or you certify on behalf of your institution and its status changes, you or your institution must notify Kraken promptly.
- Please note: Your self-certification will be subject to review. If in our due diligence we require more information from you to verify your status as a Permitted Client, we will email you with further questions.