Canada crypto exchanges get more time for stablecoin compliance

September 28, 2024 Coin Telegraph

Crypto platforms in Canada are having trouble preparing for new stablecoin regulations. Take your time, the Canadian Securities Administrators said.

The Canadian Securities Administrators (CSA) has extended the deadline for crypto trading platforms to conform to regulations regarding stablecoins. This is the second extension of the stablecoin rule enforcement.

The restrictions on value-referenced crypto assets (VRCAs) were first introduced in February 2023. They prohibited stablecoins that were not backed by a single fiat currency (such as algorithmic stablecoins) as of the end of that year. Trading in stablecoins backed by a single fiat currency (FBCAs) was allowed to continue until new regulations came into force on April 30, 2024.

Crypto asset trading platforms reported technical issues in meeting the April 30 deadline, and it was consequently pushed back to October 31. Now the date has been moved to Dec. 31. The CSA stressed that it is open to other mechanisms for meeting its concerns. “The CSA has actively engaged with CTPs [crypto trading platforms] and crypto industry participants,” it said. Furthermore:

Canadian crypto exchanges face deadline for CIRO membership

August 6, 2024 Coin Telegraph

Canadian regulatory body clarifies stablecoin rules for exchanges and issuers

October 6, 2023 Coin Telegraph

Canada

The umbrella organization for Canada's securities regulators has set out conditions for the trading and issuance of stablecoins.

The Canadian Securities Administrators (CSA) has provided guidance to exchanges and cryptocurrency issuers on its interim approach to what it calls value-referenced crypto assets, with a particular focus on stablecoins.

On Oct. 5, the umbrella organization of Canada’s provincial and territorial securities regulators published a clarification saying it may allow trading of certain cryptocurrencies that reference the value of a single fiat currency, subject to terms and conditions.

In February, the CSA reaffirmed its view that stablecoins “may constitute securities and/or derivatives” which Canadian crypto exchanges are prohibited from trading.

However, if issuers maintain an appropriate reserve of assets with a qualified custodian and crypto exchanges offering stablecoins make “certain information related to governance, operations, and reserve of assets publicly available,” then the CSA could allow for those assets to be traded.

CSA Chair and Chair and CEO of the Alberta Securities Commission, Stan Magidson, said in a statement:

“This interim framework, which we will build upon in the future, sets certain standards to help ensure that investors receive the information they need about the assets they are purchasing, including the risks associated with them.”

The CSA cautioned that fiat-backed crypto assets satisfying the terms are still risky and should not be viewed as endorsed or risk-free.

In August, Cointelegraph reported that regulatory clarity in Canada has generated greater interest in crypto from institutions.

In July, the CSA issued guidance on staking stating that it was allowed but lending opportunities are limited and the proportion of “illiquid” assets is restricted.

Stablecoin market capitalization has been in decline over the past 18 months or so and is currently at $123 billion representing around 11% of the total crypto market cap.

Magazine: Should you ‘orange pill’ children? The case for Bitcoin kids books

Crypto firms tout ‘fictitious’ regulatory stamps, Canadian regulator warns

June 21, 2023 Coin Telegraph

Coin Telegraph

"Fake" regulatory and dispute resolution entities are being used to make some crypto providers look legitimate, warns the Canadian Securities Administrators.

Canadian citizens are being advised to double-check crypto trading service providers, as the platforms may be using “fictitious” regulatory bodies to boost their credibility.

According to a June 20 Investor Alert from the Canadian Securities Administrators, some “purported” crypto platforms are claiming to be approved by certain regulatory authorities or dispute resolution organizations in “an effort to appear legitimate.”

“The websites appear to be credible at first glance, with references to complaint processing, dispute resolution and providing redress to aggrieved investors,” the CSA said in a statement.

Investor Alert: Some crypto websites use fake regulatory and dispute resolution organizations to appear legitimatehttps://t.co/Ptqx3RHjfg pic.twitter.com/2QIpwnJdcB
— CSA_News (@CSA_News) June 20, 2023

One such website even said its “fictitious certification makes it ‘a reliable and trustable online trading platform,’” according to the CSA, adding:

“But upon closer inspection, the websites’ language can be awkward and unpolished, with errors in spelling, grammar or syntax — a common ‘red flag’ of illegitimate entities.”

Some “fictitious” regulatory bodies and organizations, as listed by the CSA, include the Financial Standard Commission FSC Canada, Financial Commission/Finacom PLC Ltd., and its associated entity, Blockchain Association.

The CSA claims none of the listed entities are “known,” while also suggesting any entity claiming to be a member of the organizations is “likely fraudulent.”

Cointelegraph found a list of crypto firms that are touted as members of the “Blockchain Association” on its website — the entity is one of the dispute resolution organizations the CSA accused of being illegitimate.

*A purported list of Blockchain Association members with links to their websites. Source: Blockchain Association*

Cointelegraph contacted Etheralabs, Gallant Exchange, SmartDec, StormGain, YouHodler and Finacom PLC Ltd., Cointelligence and Asia Blockchain for comment but did not receive a response by the time of publication.

*A of certificate of Blockchain Association membership. Source: Gallant Exchange*

“Anyone considering using a crypto firm that claims to be certified or a member of a dispute resolution organization should try to independently verify that the referenced organization actually exists,” said the CSA in a statement.

The regulator also advised that citizens considering investing in crypto should check the firms against those registered with the CSA. There are currently 12 crypto trading platforms authorized to do business in Canada, while there are 11 that have filed pre-registration undertakings.

Though the regulator’s statement does not address this, it should be noted that the crypto firms themselves may be victims of the “fake” certifications, and the listing of certification does not necessarily mean a platform is “fraudulent.”

The full list of regulatory bodies and entities that have been accused of being "fake" by the CSA include:

Financial Standard Commission FSC Canada
Financial Commission/Finacom PLC Ltd.
Blockchain Association
European Financial Services and Exchange Commission
Crypto Conduct Authority/Crypto Frugal Ltd. (Ireland)
Crypto Conduct Authority/Crypto Frugal Ltd. (U.K.)
International Regulatory & Brokerage E-markets
British Investment Commission/BIC PLC Ltd.
International Financial Market Supervisory Authority
Crypto Commission Authority/Crypto Commission Ltd.

Asia Express: Yuan stablecoin team arrested, WeChat’s new Bitcoin prices, HK crypto rules

CSA

Share this video