Canadian Regulator Obligates Crypto Exchanges to Follow Securities Law
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17 January
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Canadian watchdog the Canadian Securities Administrators (CSA) has issued new guidance called "Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets," which clarified that all cryptocurrency trading platforms would be subject to the current securities law.

Canadian Watchdog Shuts Down Einstein Crypto Exchange

The watchdog claims that if digital (cryptocurrency) assets that are securities or derivatives are traded on a platform, such a platform would be subject to securities legislation. The document highlights that platforms that trade contracts or instruments that are based on cryptos would also be subject to securities legislation.

"In some cases, the crypto asset is clearly a security, for example, a tokenized security thatcarries rights traditionally attached to common shares such as voting rights and rights toreceive dividends," the watchdog added.

The Canadian regulator also clarified that in some cases crypto-related platforms would not be subject to the securities law, these are:

  • the underlying crypto asset itself is not a security or derivative;
  • the contract or instrument for the purchase, sale or delivery of a crypto asset results in an obligation to make immediate delivery of the crypto asset and is settled by the immediate delivery of the crypto asset to the platform’s user according to the platform’s typical commercial practice.

Earlier iHodl reported that the Bank of Canada, the country's central bank, was considering the possibility of issuing its own digital currency. Moreover, one of the largest crypto exchanges in Canada announced it plans to launch a stablecoin linked to the Canadian dollar.

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