September 24, 2021

Regulators in Canada introduce guidelines for bitcoin exchanges

Regulators in Canada introduce guidelines for bitcoin exchanges

The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have released guidance for cryptocurrency exchanges on the use of social media as well as advertising and marketing.

The document provides guidance regarding:

  • statements in advertising and marketing materials that could be considered false or misleading;
  • contests, promotions or "gambling-style schemes" (offering bonuses or rewards based on trading levels);
  • the use of social networks to promote cryptocurrency exchanges;
  • compliance with securities laws in general.

We are concerned that some of these strategies may inappropriately induce investors to trade excessively risky, the guidance said.

The authors recalled that registered industry participants play an important role "as overseers of the integrity of the capital markets." They should not, through their actions or inactions, "promote behavior that would harm the reputation of the market," the regulators said.

In April, the CSA and IIROC published a regulatory framework for cryptocurrencies' compliance with regulatory requirements. The guidance provides a framework for managing risks associated with digital assets, including transparency, pricing, insurance and custody standards.

Earlier, Canada updated the rules for verifying cryptocurrency holders.

Recall that in August, the Ontario Securities Commission banned two regulated cryptocurrency exchanges - Wealthsimple and Coinberry - from operating with Tether's USDT Stablecoin.

Jack Evans

About the author

I became a crypto asset owner in 2014, when the industry was in its infancy. Before that, I was working in the classic US and European stock markets. Since then, I have gained extensive experience in both cryptocurrency investing and day trading. I am happy to share with readers my experience with crypto exchanges, DeFi and NFT instruments. 

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