Canadian securities regulators talk about the regulatory framework on compliance for crypto asset trading platforms
The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) published a notice talking about the securities law requirements that apply to CTPs or crypto asset trading platforms, as well as how these may be tailor-fitted by regulators of the CTPs business model.
“The guidance in our notice details steps platform operators need to take to comply with securities legislation as they prepare to fully integrate into the Canadian regulatory structure,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers. “To bring their operations into compliance, CTPs should contact their local securities regulator now to discuss the registration process and address applicable requirements.”
“We are pleased to work with the CSA on such an important initiative,” said Andrew J. Kriegler, President and CEO, IIROC. “This framework provides guidance on how the regulatory requirements may be tailored to a platform’s business, without compromising investor protection or market integrity.”
The documents talk about securities law requirements which are platform-applicable whether it is for trading crypto assets that are derivatives or securities, contractual rights or claims to underlying crypto assets like ether or bitcoin. The notice also talks about the interim approaches that are made available to CTPs which have the goal of fostering innovation and providing flexibility, while making use that the CTPs operate in a regulated and correct environment.
Similarly, it also shows an overview of key risks which are directly involved in CTPs and areas where requirements may be customized, provided that these key risks are addressed, and protection of investors are not compromised. Lastly, the notice also outlines the process for submitting applications to IIROC and CSA jurisdictions, as applicable.
“We remind all CTPs that are dealing with Canadians, including foreign-based CTPs, that they are expected to comply with Canadian securities legislation,” added Louis Morisset. “Failure to do so could result in CSA members pursuing enforcement action.”
Joint Canadian Securities Administrators and Investment Industry Regulatory Organization of Canada Notice 21-329 Guidance for Crypto Asset Trading Platforms: Compliance with Regulatory Requirementsis available on the websites of CSA members and IIROC.
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