Canadian Regulators Want Participation From Crypto Industry In Securities Law Review


Two Canadian regulatory bodies have issued a joint call asking participants in the crypto industry to take part in a review of the country’s securities law.

The Canadian Securities Administrators (CSA) and Investment Industry Regulatory Organization of Canada (IIROC) jointly published a consultation paper on Thursday, March 14, with the intention of gathering feedback from the industry regarding crypto regulation.

In a press release, the two national securities regulators summarized the consultation paper as premised on the need for existing laws to be tailored to incorporate the emergence of a whole new crop of crypto-focused trading platforms.

As a national standards body, the CSA’s mandate sees it cover a total of 57 different sections of the market. the IIROC, on the other hand, is a self-regulatory body whose scope of operations include providing oversight over investment providers and trading platforms.

According to the CSA Chair Louis Morisset, the consultation provides for “a proposed regulatory framework” that should lead to added clarity for platforms, as well as improve investor protection and overall market integrity.

He also added that platforms had told the regulator that having “a tailored regulatory framework” would be a welcome factor, helping these platforms in their quest to “build consumer confidence.”

The framework would also be vital as they seek to expand businesses across the country and into global markets.

Issues surrounding crypto and their regulation under securities laws continue to occupy the minds of many market regulators around the world, with most seeking to have a framework that governs their issuance and trading.

While the U.S. Securities and Exchange Commission (SEC) has taken a proactive stance against tokens deemed to be securities, Canadian regulators have somehow remained reticent. Even with this latest effort, the approach leans more towards being pro-change than it is about specific crypto market participants.

The president and chief executive of IIROC Andrew J. Kriegler said that the consultations form a part of the regulatory bodies’ journey to understand an area that continues to grow- drawing the interest of not only regulators but investors and marketplaces as well.

The IIROC CEO added that it is important for regulators to “adapt to innovation, and provide clarity to the market,” especially with regard to how to tailor the regulatory requirements to help maintain investor protection.

Others expected to participate in the consultations include fintech companies and investors.

The CSA and IIROC move comes at a critical time for the Canadian crypto market, given the troubles facing the QuadrigaCX crypto exchange. The platform has been unable to locate crypto worth over $140 million owed to 115,000 users after the sudden death of its founder and CEO.

The exchange has been granted creditor protection as it works with court-appointed monitor Ernst & Young (EY) to try and locate the funds as well as get its cash currently held by several payment processors.

Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.

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