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We wanted to take a minute to share with you what is going on in the crypto market in Canada on the regulation side of things. We will share our view on regulation generally, as well as the view of the current recommended regulations in direct response from the fallout of exchanges like QuadrigaCX and Einstein within the Canadian market.
Firstly – CoinSmart.com is fully on board with a regulated cryptocurrency market. We believe in a fair, balanced approach that allows us to conduct business on Canadian soil, while keeping YOU, our users and lifeline of our company safe and protected. We believe regulation helps to protect you from nefarious individuals and fraudulent organizations, while helping to establish security requirements and standardization of internal processes to ensure safekeeping of all assets held on our platform. The specifics around the type and extent of regulation needed however is not clear and should be an ongoing dialogue between regulators and industry leaders to help determine what makes sense, what is feasible, and ultimately how to maximize your protection. As it stands now, things are not moving in that direction, but we are working to change that.
We at CoinSmart have full faith that by opening up the conversation, with such parties as the Canadian Securities Administrators’ (CSA), Investment Industry Regulatory Organization of Canada (IIROC), and Ontario Securities Commission (OSC), we will be able to ensure the very best for our users, while helping to push the cryptocurrency and digital asset market in Canada forward. It’s at times like these, with all the craziness and uncertainty going on in the world that we can see the use case for it clear as day.
We have come together with our counterparts in the industry to take a stance, and that stance is: open communication and fair planning.
Today, we will share with you the letter we submitted to the CSA together with other industry leaders, in response to the Staff Notice published in mid-January.
On January 16th, 2020, the Canadian Securities Administrators’ (CSA) released Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets.
This Staff Notice sets out the position of CSA staff that if a platform does not immediately deliver crypto assets purchased on the platform to its customers, it is likely dealing in securities or derivatives. In our view, this interpretation represents a significant departure from the CSA staff’s earlier notices on crypto assets. Based on the CSA’s consultation paper published in March 2019, we had expected that platforms would be regulated under a new legislative framework that would accommodate for the differences between crypto assets, securities and derivatives, while still protecting investors. However, this latest Staff Notice indicates the are viewed one and the same.
We look forward to serving you, our loyal users, for decades to come. We are still in the very early days of the cryptocurrency/blockchain revolution. Our hope is that we continue to serve you with the best customer experience and best product offering in the business, and that together we see a market that is going to the moon! We intend to do everything in our power to work alongside regulators to ensure the safety and protection of all users. Watch out for some cool new products and features we are bringing to the market in 2020!