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

"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.

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Marriages and court cases can be held in the metaverse

Coin Telegraph

Singapore's Second Minister for Law believes an integrated platform using the Metaverse will make the dispute resolution process more convenient and efficient.

Legal marriage proceedings, court case disputes, and government services may one day be offered on the Metaverse, according to a Singaporean government minister.

Speaking at the TechLaw Fest 2022 on July 20, Singapore’s Second Minister for Law Edwin Tong argued even highly personalized, intimate events such as the solemnization of marriages have taken place online in the Metaverse.

"It would not be unthinkable that, besides registration of marriages, other government services can soon be accessed online via the Metaverse."

On the subject of legal services in the Metaverse, the Minister added that there is "no reason why the same cannot be done for legal services."

"The pandemic has already shown us that even dispute resolution — once seen to be a physical, high-touch process [...] can also be held almost entirely online."

Minister Tong gave the example that a legal dispute involving an accident on a construction site for example could be viewed in three dimensions via a “single virtual platform” using augmented reality (AR) technology.

“You can put yourself into the actual tunnel or the oil containment facility to look at the construction dispute from the perspective of an augmented reality, representing the actual space.”

Minister Tong stated that the addition of such technology would not preclude traditional offline hearings from taking place. He noted that “there can always be a hybrid element.”

“I believe such an integrated platform will make the whole dispute resolution process more convenient, efficient, and it keeps pace with how the rest of the world is developing.”

Earlier this year, metaverse platform Decentraland hosted its first wedding on its Metaverse with a virtual crowd of 2,000 guests and law firm Rose Law Group to legally formalize the marriage.

The group’s founder and president, Jordan Rose, claims it was the first-ever wedding hosted on any blockchain-based Metaverse.

Meanwhile, South Korea’s government has already been taking steps toward the Metaverse after setting aside $177 million to develop a platform for citizens to access various government services.

Dispute Resolution