The Canadian Securities Administrators (CSA), Canada’s market regulator, has issued guidance to see if crypto companies comply with securities regulations.
“If crypto assets such as securities or derivatives are traded on a platform, such platform would be subject to securities legislation. In addition, if a platform trades contracts or instruments that are derivatives based on crypto assets, the platform would also be subject to securities legislation,” the market watchdog said in a release.
It added that the regulations may also apply to the exchanges that buy and sell digital assets as the customer’s contractual right to the asset may represent a derivative.
“In some jurisdictions, this right may be considered a security, such as an investment contract or evidence of indebtedness or an evidence of title to or interest in the assets or property of another person,” the market regulator said.
Some operators know that their platforms do not comply with regulations because they can only process digital assets that do not involve derivatives or securities.
“However, based on our analysis of how trading occurs on platforms, we note that some platforms are merely providing their users with a contractual right or claim to an underlying crypto asset, rather than immediately delivering the crypto asset to its users,” the release stated. “In such cases, after considering all of the facts and circumstances, we have concluded that these Platforms are generally subject to securities legislation.”
It seems that Canada is one of the most active countries as regards the regulation of crypto market.