It’s been announced that crypto-friendly Canada’s cryptocurrency exchanges will now be subject to scrutiny by the Ontario Securities Commision (OSC) due to the increase of digital currencies on the market.
Due to the recent increase of digital currencies now available and rocketing in value since 2017, the market has now opened up to some less reputable projects as well as genuine new exchanges.
Due to this, decentralized cryptocurrency climate regulators have decided to step in order to ensure that Ontario’s exchanges are adhering to the country’s security laws. OSC spokesperson Kristen Rose suggested that several cryptocurrency platforms operating in Ontario had not been registered. She commented, “if an exchange is doing business in a jurisdiction in Canada, it must apply to that jurisdiction’s securities regulatory authority for recognition or an exemption of recognition”.
Canada’s move towards further cryptocurrency regulation and transparency reflect the growing trend with governments around the world to tighten the regulatory grip on the industry as a whole. The US Securities and Exchanges Commission (SEC) has been particularly active this year in tracking down and prosecuting fraudulent cryptocurrency exchange activity.
Australia is another country in the process of tightening regulation, due in part to Bitcoin scams and money laundering. Platforms are now required by law to register or face harsh penalties.
Currently, trading in cryptocurrencies in Canada is subject to the same Canadian tax law rules as trading in shares or commodities such as gold. Earlier this year, as China looked to crack down on energy usage due to crypto mining, Canada began luring Bitcoin mining companies. Quebec, in particular, with its plentiful hydro resources and relatively cheap electricity, was keen to lure companies from China to boost local business.
Quebec is one of the largest hydroelectric power producers in the world and routinely produces a surplus. A cold climate makes computer cooling costs lower and Canada’s political stability is also seen as a plus for investors.
