BTC Ownership in Canada Rises Sharply in 2021, Bank of Canada Study Shows 13% of Canadians Own Bitcoin

October 15, 2022 Bitcoin.com

Coinsquare becomes first Canadian crypto exchange to receive IIROC registration

October 12, 2022 Coin Telegraph

Canada

All crypto exchanges must register with IIROC if they want to operate in Canada, and there is currently a backlog of applications.

Coinsquare, Canada's longest-operating crypto asset trading platform, announced on Oct. 12 that the Investment Industry Regulatory Organization of Canada (IIROC) had approved its dealer registration and IIROC membership. This regulatory status will now position Coinsquare as the first crypto-only IIROC-registered investment dealer and marketplace member in Canada. The Coinsquare team wrote:

"In dealing with an IIROC registrant, Coinsquare clients now have the added comfort and security of knowing that Coinsquare is operating at the highest level of dealer compliance and oversight under the existing regulatory system."

With the regulation, Coinsquare's client funds will be fully segregated and kept by licensed and insured custodians. Coinsquare will also be required to report its financial standing regularly and maintain adequate capital for liabilities. In addition, cash held in client accounts will be protected by the Canadian Investment Protection Fund in the event of insolvency.

Currently, Coinsquare has more than 500,000 users and offers access to over 40 cryptocurrencies, including more than 820 coin-to-coin trading pairs. The exchange has facilitated approximately $5.82 billion in trades since its inception in 2014.

Canada has taken a different regulatory approach than the United States. In Canada, all crypto exchanges operating in the country must be registered or at least apply to the IIROC. In June, regulators banned the crypto exchange Kucoin from operating in the Canadian province of Ontario, alleging that the firm did not respond to information requests.

More than 30% of Canadians plan to purchase crypto by 2024, says OSC head

October 6, 2022 Coin Telegraph

Adoption

Ontario Securities Commission CEO Grant Vingoe said the regulator planned to release a report in October which included crypto adoption rates in Canada.

Grant Vingoe, chief executive officer of the Ontario Securities Commission, reiterated the regulator’s technology-neutral stance on crypto while saying many Canadians planned to become HODLers in the near future.

In a keynote address before the Economic Club of Canada on Oct. 6, Vingoe said the regulatory fundamentals of stocks and bonds were equally applicable to crypto contracts, with the “vast majority of crypto-based entities” falling within the OSC’s jurisdiction. According to the OSC head, the regulator largely considered Bitcoin (BTC) and Ether (ETH) to be commodities, while “arrangements that trading platforms have with investors" constituted securities.

“As securities regulators, none of the characteristics of crypto assets or their underlying technology, either positive or negative, drives our regulatory approach,” said Vingoe. "We are not here to pick winners and losers among investments. We take a careful and technology-neutral approach to all new products that come into our market, and we apply the same reasoning in assessing them.”

He added that the growing crypto market becoming interconnected to the financial system potentially posed a concern, citing the collapse of digital asset exchange QuadrigaCX:

“We know from our own research (being published later this month) that more than 30 per cent of Canadians plan to buy crypto assets in the next year [...] It is a challenge to bar non-compliant firms from offering services in Canada. With a limited budget and finite Enforcement staff to cover our entire capital markets, there is only so much we can do. But we are making progress.”

“We are not here to pick winners and losers...We take a careful and technology neutral approach to all new products that come into our market” - OSC CEO @GrantVingoe on the approach to bringing the crypto industry into the OSC's regulatory regime pic.twitter.com/eSlAH0QomR
— OSC News (@OSC_News) October 6, 2022

The Canada-based regulator has taken enforcement actions against crypto firms Bybit and KuCoin, largely claiming violation of securities laws and operating unregistered crypto asset trading platforms. As of Aug. 15, 9 companies are listed as registered crypto businesses under the OSC, including Fidelity Digital Assets, Newton Crypto, and Bitbuy.

Coinsquare acquires publicly-traded crypto exchange CoinSmart

September 23, 2022 Coin Telegraph

Canada

CoinSmart reported $16.7 million in gross revenue in 2021 as retail trading volumes soared during the Bitcoin bull market.

Canada’s crypto exchange landscape appears to be consolidating after Coinsquare, one of the largest digital asset trading platforms in the country, acquired CoinSmart for an undisclosed amount.

On Thursday, Coinsquare announced that it had entered into a definitive agreement to purchase all issued and outstanding shares of CoinSmart’s wholly-owned subsidiary Simply Digital. Once the deal becomes final, CoinSmart will hold a roughly 12% ownership stake in Coinsquare on a pro-forma basis.

Shares of the CoinSmart crypto exchange, which trade on the NEO Exchange, were up 67% on Friday, largely in response to the news.

The acquisition makes Coinsquare one of Canada’s largest crypto exchanges and expands its operational and business capabilities. Founded in 2014, Coinsquare has expanded its service offerings to include retail and institutional trading, crypto payment processing and digital asset custody.

CoinSmart was co-founded in 2018 by Justin Hartzman, who also served as the company’s CEO. Following the acquisition, Hartzman is set to join Coinsquare’s executive team.

As a publicly-traded company, CoinSmart discloses its financial statements quarterly. In its annual summary released on April 1, the company reported $16.7 million in gross revenue in 2021, an increase of 357% year-over-year. Retail trading volume grew by 875%, likely reflecting the Bitcoin (BTC) bull market of 2021.

Coinsquare is one of just two crypto exchanges operating in Canada to pre-register with their principal regulators as they work toward full compliance with securities laws. The pre-registration requirements were established by the Canadian Securities Administrators, or CSA, and allow crypto exchanges to remain operational while their full applications with CSA are being reviewed.

CoinSmart CEO, @JustinHartzman will be speaking on a panel @Futurist_conf talking about #Web3 and the future of the Internet!

Also on the panel: @forgeforth_ - @Cointelegraph @GDADave - @SD_Markets
Kimberly Adams - @bridgenetwork0x
Vincent Kadar - @PolymathNetwork #crypto pic.twitter.com/thLF35QnaK
— CoinSmart (@CoinSmart) August 8, 2022

In an interview with Cointelegraph on the sidelines of the Futurist conference in Toronto in August, Coinsquare chief operating officer Eric Richmond explained that the crypto exchange registered with the Investment Industry Regulatory Organization of Canada, or IIROC, in November 2020.

Crypto adoption in Canada is on the rise, but like in other countries, participation is largely based on underlying market conditions. According to a KPMG survey, adoption is also growing within institutional circles due to crypto’s perceived upside and innovative potential.

Report: Quebec’s Mohawk Council of Kahnawake Seeks Energy to Power Crypto-Mining Opportunities

September 19, 2022 Bitcoin.com

Canadian PM Justin Trudeau says investing in crypto is not an escape from inflation

September 13, 2022 Coin Telegraph

Canada

Canada's inflation rose to 40-year highs this year while Bitcoin's price plummeted in the same period.

According to a new Twitter post on Tuesday, Canadian Prime Minister Justin Trudeau made critical remarks regarding newly elected opposition leader Pierre Pollievere's pro-crypto platform, writing:

"We’ll also call out questionable, reckless economic ideas. Telling people they can opt out of inflation by investing in cryptocurrencies is not responsible leadership."

In a separate TV appearance, Trudeau reiterated the remarks, adding that "responsible leaders" shouldn't advocate for individuals to "invest their life savings in volatile cryptocurrencies."

On Saturday, Calgary-born politician Pierre Pollievere won 68.15% of the votes in an election for the next leader of the Conservative Party of Canada, or the official opposition to the incumbent Liberal Party led by Justin Trudeau.

Pollievere is a pro-crypto advocate who has pledged to transform Canada into "the blockchain capital of the world," citing positive job creation prospects within the Web3 sector and a lower cost to access financial products as reasons to support the intent. In past interviews, Pollievere claims that the government is "ruining the Canadian dollar," and that Canadians should uconsider other forms of money, such as crypto.

Earlier this year, Canada declared a state of emergency after a convoy of truckers, dubbed the "Freedom Convoy," blockaded the downtown area within the nation's capital, Ottawa. The group advocated for an end to all coronavirus-related lockdown measures and an end to vaccine mandates.

In response, the Trudeau government invoked the country's Emergency Act, empowering banks to freeze funds related to protestors' activities. Subsequently, an Ontario judge ordered millions of Bitcoin-denominated donations to the group's wallet address to be frozen. The RCMP, or Canada's federal police, also requested crypto exchanges to freeze wallets held by protestors.

As of July 2022, inflation in Canada stood at 7.6%, representing the highest level in the past 40 years. Meanwhile, cryptocurrencies have not held on as an "inflation hedge" this year, with the overall market cap of digital assets falling over 60% from January.

Bitcoin is for those in need, the rest need time to learn: Surfin Bitcoin Panel

August 31, 2022 Coin Telegraph

Brazil

A panel discussion hosted at Surfin Bitcoin, France, illustrated that while Bitcoin works for those in need, more education is required.

Bitcoin (BTC) is there for those that need it most; the rest may need time to learn. This message reverberated around the casino conference hall during a panel at Surfin Bitcoin, a Bitcoin-only conference in Biarritz, France, on Aug 26.

Panelists Ben Perrin, a Bitcoin Youtuber; Ernesto Hernandez, a Salvadoran business consultant; and Carol from the popular Brazillian Youtube channel “Area Bitcoin” tackled a tricky topic: “Victims of the Banking System around the world: Inflation, Censorship.” The role of Bitcoin in such testing environments was brought into question.

From left: Hall, Perrin, Carol and Hernandez

The panelists unloaded experience, evidence and anecdotes from their respective countries: Perrin from Canada, Hernandez from El Salvador and Carol from Brazil in order to tackle the topic. Hernandez, for example, was quick to illustrate that in El Salvador, Bitcoin is no silver bullet.

The tiny Central American country introduced the “Ley Bitcoin” in 2021, but “Let’s not forget that 8 out of 10 Salvadorans were unbanked,” he explained. “It’s a big jump for people to buy a house–or even buy groceries,” without prior knowledge of how banking or financial services work.

Plus, the Chivo app, supported by the government, endured some criticism and even attacks from protestors when first launched. The government app is still under scrutiny. During the Q&A session, Bitcoin podcaster Rikki–who spent 45 days living off Bitcoin only with his partner Laura–queried Hernandez on Bitcoin remittance to El Salvador.

Rikki cited a report regarding El Salvador and remittance, which, while positive, shows that Bitcoin is critically underused for remittance payments. Ernesto explained that currently, interest in El Salvador tends to come from foreign investors and Bitcoin enthusiasts, as opposed to Salvadoran workers living abroad sending money home. Ultimately, the real challenge is educating Salvadorans on the advantages of using Bitcoin as a remittance tool.

Living #Bitcoin only is possible? We just did it! 45 days traveling all over #ElSalvador spending only bitcoin.

More than 10 cities, hotels, restaurants, breakfasts, cars, gas stations, SIM cards, coffee, drinks and more at our fingertips thanks to the #LightningNetwork ⚡️ pic.twitter.com/QC5ALJNP5s
— Laura Nori ⚡️ (@Lorinaura) January 18, 2022

Nonetheless, he said with a smile that it’s “fun” to see Salvadorans who had never used banking services before in their life now use Bitcoin on the Chivo app, saving and spending money. Plus, the SEO words “invest in El Salvador” did not exist before La Ley Bitcoin. Bitcoin has really put the country on the world map and, by proxy, on the world wide web, he explained.

'Victims' of banking

Carol, whose Youtube channel recently became a Bitcoin-only channel, explained that the victimization of Brazilians by central banks is historic. Brazil endured “Nine currencies in the last hundred years, 8 died because of hyperinflation from money printing and mismanagement.” Plus, while the Real, Brazil’s current national currency, is 27 years, it “Has already depreciated by 86%.” Bitcoin is a way to opt out of such a system.

Ben Perrin brought up the “largest protests in Canadian history,” the Canada trucker protests, also known as the “freedom convoy.” He illustrated that, at times, the banking system targets specific individuals or groups. Plus, he alluded to the collusion between the banking system and governments:

“Our media in Canada is directly subsidized by the government. They get billions of dollars every single year. It helps if you have a specific message you want to get out and you are the ones bankrolling the ones in charge of taking that message to the people.”

On balance, he also conceded that sometimes the banking system just sometimes doesn’t work–and it’s not the fault of a person or an intended consequence. In El Salvador, for example, Hernandez shared that the banks had just seven days to implement Bitcoin into their new system–so it’s no wonder that sometimes the system makes mistakes, Ernesto explained.

On bear markets

On an optimistic note, Perrin expressed that bear markets are for building and there is some amazing innovation going on in 2022. Despite this, Bitcoin lives in a bubble unknown or ignored by the rest of the world. Carol added that Bitcoin is “attacked” the most during bear markets, yet it also gives time for Bitcoin to breathe and it’s a reminder to people to take their time:

“The fiat mindset is a short-term mindset. Everything is quick and must be now–tomorrow–instantly. Fiat discriminates, but anyone can use Bitcoin. When you start to reflect about Bitcoin you start to think about all of your choices in life.”

Carol compared the government's manipulation of money to a way of manipulating mindsets. Even in high inflationary environments, such as in her home country, Brazil, Bitcoin adoption is still slow. The challenge for educators such as herself, Perrin and Hernandez are, therefore, to get through to people that fiat money has no backing.

Finally, Hernandez echoed that education continues to be the most important component to Bitcoin adoption but technology is still a challenge. He notes that “if you grab a knife at the opposite side, you will cut your hand.” You have to learn to use the knife.

He stated that small seeds of adoption are now sprouting across the developing world: he brought up the example of Machankura—the company that brings Bitcoin over Lightning to those without internet connections in Africa. The group has support from names including Jack Dorsey.

Bear market uncertainty is the perfect time to build and learn, says Sato exec

August 27, 2022 Coin Telegraph

Bitcoin mining

Fanny Philip, COO of Sato Technology, doubled down on believing that bear markets should be considered a builder’s market for mining companies.

The decisions made by companies during bear markets play a pivotal role in determining their longevity in the crypto ecosystem. Representing Canadian Bitcoin (BTC) mining firm Sato Technologies, COO Fanny Philip revealed what it takes to survive the bearish loom as the market prepares for the next bull run.

Speaking to Cointelegraph during the Surfin’ Bitcoin 2022 event in France about the impact of bear markets on business, Philip said now is the time for mining companies to build and learn.

Sato is a digital assets mining company, publicly traded on the Toronto Stock Exchange (TSXV) since Sept. 2021 and mines both Bitcoin (BTC) and Ether (ETH).

Philip further told Cointelegraph about the initial challenges of setting up in the industry despite entering the space during a bull market.

The high demand for miners in the Quebec region of operation, where the company initially set up shop, caused a moratorium on new mining facilities and unfriendly sentiments from the local residents. Moreover, Philip related the global pandemic as a catalyst for “difficulties in sourcing electrical equipment."

Though when asked about the effects of the bear market, Philip had more positive sentiments than negative ones. When asked if bear markets are a good thing, she answered:

“To build? Perfect. Bear market is a built market for us.”

She also commented on the relationship between the price of BTC, mining and purchasing mining equipment.

“When the price of Bitcoin is low, you mine more,” Philip said. “If you have to [purchase] equipment, since it’s linked to the price of the Bitcoin, the price of the equipment decreases a lot."

All of these factors mentioned above help companies in the industry build, and according to Philip, Sato is in the building phase.

This can be seen in the company’s brand new agreement with Foundry Digital LLC (Foundry). The two companies struck a deal that makes it possible for Sato to host up to an additional 4,300 miners at Center One in Québec. All of which will be powered by renewable energy.

Sato uses its mining capabilities to mine a small amount of ETH in addition to its primary focus on BTC mining.

When asked about any strategies to face the upcoming Ethereum Merge, Philip said it's the time to diversify and learn about options.

“What’s going to happen, nobody really knows. That’s why we decided to diversify. Mining is our core business but we develop a lot of applications on top of the Lightning Network."

On an end note, she highlighted that The Merge could be seen as an opportunity to look at all possibilities to build and earn within the Ethereum ecosystem. “It’s all part of the evolution,” Philip concluded.

Quebec Pension Fund loses almost entirety of its Celsius investment in less than ten months

August 17, 2022 Coin Telegraph

Canada

"For us, it is clear, when we look at all this, we arrived too soon in a sector which was in transition," says CEO Charles Émond.

According to local news outlet LaPresse on Wednesday, the Caisse de dépôt et placement du Québec (CDPQ), an institutional investor chartered with managing retirement assets in Canada's predominantly french speaking province of Quebec, wrote off almost the entirety of its CA$200 million ($154.7 million) investment in troubled cryptocurrency lender Celsius Network.

The move came just ten months after the CDPQ and growth equity firm WestCap made a joint investment of $400 million into Celsius at a valuation of $3 billion. At that time, Celsius boasted over 1,000 employees, $25 billion in total assets, and $850 million in cumulative interest paid to depositors.

However, as an unregulated and centralized entity, depositors' assets are not protected in the event of losses, nor is the firm subjected to any restrictions on use of leverage. During the onset of this year's crypto winter, the sudden and violent crash of Bitcoin and other digital assets left a $2.85 billion gap in Celsius' net assets. As a result, it suspended withdrawals on the accounts of nearly 1.7 million customers in June.

It appears that the loss on Celsius represents only a negligible fraction of the CDPQ's portfolio. By June 30, the CDPQ managed a combined CA$391.6 billion in total assets, decreasing by 7.9% in the past six months. The entity is currently evaluating its legal options against Celsius, though it has not shared any details. According to court filings, Celsius is scheduled to run out of money by October.

Canadian regulatory council creates new preregistration filing for crypto platforms

August 15, 2022 Coin Telegraph

Canada

The Canadian Securities Administrators will require crypto trading platforms to file an undertaking committing them to investor protections while their registration is in process.

The Canadian Securities Administrators (CSA), the council of provincial and territorial securities regulators, announced Monday that crypto trading platforms will be expected to provide a preregistration undertaking to their principal regulators as they take steps to comply fully with securities regulation. Two platforms, Crypto.com and the Canadian platform Coinsquare Capital Markets, have already filed those undertakings.

Trading platforms will be expected to agree in the undertaking to comply with terms and conditions relating to investor protection. Filing the undertaking will allow crypto trading platforms to continue operating during the review of their applications for registration with the CSA. The new undertaking is part of the “interim approach” introduced in the guidance on securities law requirements for crypto asset trading platforms released in March 2021 by the CSA and Investment Industry Regulatory Organization of Canada (IIROC).

Crypto.com and Coinsquare Capital Markets filed undertakings with the Ontario Securities Commission, which is their principal regulator. The CSA said in its announcement that it was in discussion with other platforms about the undertaking.

Crypto trading platforms in Canada face lengthy waits for registration. They can obtain “restricted dealer” status before receiving full registration. Platforms that have applied to be restricted dealers still need to file the newly instituted undertaking.

Crypto.com pointed out in a statement that it is already regulated in Canada by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) and the Autorité des marchés financiers (AMF) of Quebec. Crypto.com CEO Kris Marszalek said in the statement that:

“The North American market, and Canada specifically, represent a significant area of potential growth for the crypto market.”

The CSA indicated that member organizations could “take action” against platforms that fail to file an undertaking.

Canada

'Victims' of banking

On bear markets

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