Canada: Cryptocurrency And Blockchain — Charting Recent News And Developments

Cryptocurrency and blockchain technology are burgeoning and disruptive areas. Almost daily, a new type of cryptocurrency or cryptocurrency-related product is announced or a new application for blockchain technology is found. Regulators are working hard to respond to these developments with rules, decisions, guidance and advisories. 

Below are snapshots of some of the more interesting or significant developments in this space over the past few months.


CSA 2017/18 enforcementreport highlights cryptocurrency

The Canadian Securities Administrators (CSA) continue to conduct ongoing research and analysis to monitor and mitigate fraud-related risks associated with cryptocurrency offerings and initial coin offerings. This includes: (i) establishing a taskforce in collaboration with other CSA committees; (ii) engaging with their international colleagues at the North American Securities Administrators Association; and (iii) working with global digital platforms to ban related advertising.

Cryptocurrency to bereflected in the report of exempt distribution (Form 45-106F1)

Information about an issuer's involvement with cryptocurrencies will be required to be provided in Form 45-106F1, once amendments to the form come into effect on October 5, 2018. Non-investment fund issuers, whose primary business is to invest all or substantially all of their assets in cryptoassets, will have to identify cryptoassets as their primary business. Investment fund issuers, in selecting their "type" of fund, will be required to select "cryptoasset" as their fund type if this accurately identifies the objective and strategies of the fund.  The list of security codes in the general instructions to Form 45-106F1 will also be amended to introduce a new security code "DCT" for distributions of securities involving digital coins or tokens.

Ontarians' knowledge of cryptocurrencyis low

According to research conducted by Innovative Research Group, on behalf of the Investor Office of the Ontario Securities Commission, while awareness of cryptocurrencies is high, knowledge is relatively low. For instance, while a large majority (81 per cent) of Ontarians have heard of Bitcoin, most are not very familiar with the concept of cryptocurrency. Five per cent of Ontarians currently own cryptocurrency and four per cent have done so in the past. Just over one-third of Ontarians believe that cryptocurrencies are unregulated.

Conversion/wrongfuldetention of cryptocurrency

An action is currently before the courts in British Columbia considering whether cryptocurrency is properly the subject of a claim in conversion/wrongful detention. This action relates to the mistaken transfer of a cryptocurrency to a purchaser during the initial coin offering of another cryptocurrency. After demands for the return of the mistakenly-transferred cryptocurrency were made and the action commenced, the purchaser stated his wallet had been hacked and the mistakenly-transferred cryptocurrency was gone. At issue is whether the purchaser will be liable for failing to return the mistakenly-transferred cryptocurrency. 

Cryptocurrency andblockchain added as topics to CFA exams

According to a report in Bloomberg, the CFA Institute is adding both blockchain and cryptocurrency as topics to the CFA Level I and II exams for the coming year.   

Still nocryptocurrency ETF in the U.S. or Canada

No cryptocurrency-based exchange-traded fund (ETF) has been approved by the CSA or by the U.S. Securities and Exchange Commission (SEC). On August 22, 2018, SEC staff rejected nine Bitcoin ETF proposals from three companies. This decision is under review by the commissioners of the SEC. SEC staff have delegated authority to make a decision on such applications, meaning the commissioners and the SEC chairman have the power to review the decision if they desire.

In July 2018, the SEC rejected the Winklevoss Bitcoin Trust, a proposed Bitcoin ETF, citing that it did not agree with the Winklevoss' premise that cryptocurrency markets are uniquely resistant to manipulation. The SEC also rejected the proposal due to concerns regarding fraud and investor protection.

On August 7, 2018, the SEC announced that it was delaying its decision on the VanEck/SolidX Bitcoin ETF until September 30, 2018. This VanEck/SolidX Bitcoin ETF proposal was filed with the SEC in June and is backed by the Chicago Board of Exchange BZX Equities Exchange (CBOE).

SEC examining firms' cryptocurrenciespractices

According to reports, brokerage firms have been questioned in recent weeks by SEC examiners about their business practices and how they deal with clients in relation to cryptocurrencies. The SEC is apparently seeking specific information about fees generated from trading and financing initial coin offerings and is also gathering data on investment advisers' involvement. 

The SEC's activities reflect the joint statement by the chairman of the SEC and the chairman of the U.S. Commodity Futures Trading Commission (CFTC) earlier in the year that both agencies are looking at cryptocurrency, particularly to bring transparency and integrity to these markets and to deter and prosecute fraud and abuse.

The SEC also recently appointed Valerie Szczepanik as Senior Advisor for Digital Assets and Innovation, a newly-created position. The responsibilities of this role include coordinating efforts across all SEC divisions and offices regarding the application of U.S. securities laws to emerging digital asset technologies and innovations, including initial coin offerings and cryptocurrencies.   

Buyer beware accordingto the CFTC

The CFTC issued "Customer Advisory: Use Caution When Buying Digital Coins or Tokens" on July 16, 2018, alerting customers to exercise caution and conduct extensive research before purchasing cryptocurrencies. The CFTC warns of the factors that could impact a cryptocurrency's current or longer-term value, including, among others, the potential for forks in open-source applications that could split away market participants, increase the number of digital coins, or make coins obsolete. The CFTC also advises investors to thoroughly research cryptocurrencies and exercise caution, given the considerable risks and significant potential for fraud relating to cryptocurrencies.

Basel Committee examining banks' exposure tocryptocurrency markets

The Basel Committee on Banking Supervision is looking at how 45 central banks and global regulators treat exposure to the cryptocurrency market. The so-called "stocktake" will be used by the committee to clarify how members should factor in cryptoassets when assessing bank risk levels.

About BLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions