{"id":284744,"date":"2021-06-26T19:13:00","date_gmt":"2021-06-26T16:13:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/"},"modified":"2021-06-26T19:13:00","modified_gmt":"2021-06-26T16:13:00","slug":"crypto-in-canada-where-are-we-today-and-where-are-we-heading","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/","title":{"rendered":"# Crypto in Canada: Where are we today, and where are we heading?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3ac14fe6743\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3ac14fe6743\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/#Regulatory_support_for_digital_asset_innovation\" >Regulatory support for digital asset innovation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/#The_dichotomy_of_digital_asset_regulation\" >The dichotomy of digital asset regulation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/#Canadian_regulatory_trends_in_2021\" >Canadian regulatory trends in 2021<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/#Canada_stays_ahead_as_a_miners_paradise\" >Canada stays ahead as a miners\u2019 paradise<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\/#What_does_the_future_hold_for_crypto_regulation\" >What does the future hold for crypto regulation?<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Crypto in Canada: Where are we today, and where are we heading? <\/strong>&#8221;<br \/>\n<img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDYvZDg4NDFhYTMtNGIwOC00YTdmLWIwNDUtMjE5NGVhZTM0MThlLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-128018ef>Digital currencies are quickly becoming more mainstream within the Canadian financial landscape. Alongside this increased adoption, Canada has been relatively successful at creating a stable regulatory environment. In 2014, Canada established itself as a leader in the global digital asset space when the Canadian Parliament became the first government in the world to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.loc.gov\/law\/help\/cryptocurrency\/canada.php\">pass<\/a> a national law on digital currencies. Since then, Canadian regulators have remained fairly proactive in their <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>roach toward cryptocurrency, taking a cautious-yet-optimistic stance in an attempt to promote innovation while still protecting investor interests.\u00a0<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Regulatory_support_for_digital_asset_innovation\"><\/span>Regulatory support for digital asset innovation <span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Especially in comparison to other international jurisdictions, which either impose stricter policies or harbor a more laissez-faire attitude, Canada\u2019s supportive environment to cryptocurrency is reflected in some of the options offered to startups experimenting with digital asset <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a>. <\/p>\n<p>For example, the Canadian Security Association\u2019s (CSA) sandbox initiative <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/fcnb.ca\/en\/news-alerts\/the-canadian-securities-administrators-launches-a-regulatory-sandbox-initiative\">supports<\/a> financial technology (fintech) businesses seeking to offer innovative products by carefully vetting business models in live-testing environments. Similarly, the Ontario Securities Commission (OSC) LaunchPad <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.osc.ca\/en\/industry\/innovation-osc\/osc-launchpad-support-innovative-businesses\">works<\/a> with financial service businesses to keep regulation aligned with digital innovation and encourage the development of products, services and applications that meet compliance standards required by securities laws. <\/p>\n<p>In addition to these services aimed at innovators looking to collaborate directly with financial authorities in the context of their specific business model, regulators have also published broad, but comprehensive, guidance on navigating applicable legislative frameworks. <\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>Will regulation adapt to crypto, or crypto to regulation? Experts answer<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_dichotomy_of_digital_asset_regulation\"><\/span>The dichotomy of digital asset regulation<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The need for regulation has polarized the crypto industry ever since its inception. Investors and enterprises are hungry for processes, for which having a regulatory framework is a must. On the other hand, an over-regulated economy might isolate Canadians from integrating with the broader digital asset industry, forcing investments overseas. So, what is a good balance between the two? <\/p>\n<p>Early advocates of blockchain presumed that its distinctive qualities of disinter<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>tion make it insusceptible to regulation and argued that cryptocurrency had been created as a solution to the stringent public oversight of financial markets. Under this assumption, many token issuers before mid-2017 largely ignored securities law registration requirements meant to protect investors and foster fair markets. <\/p>\n<p>However, reliable legal remedies are necessary for the protection of individual rights and are integral for a functionally accountable jurisdiction. Especially within the financial sector, where individuals are extremely vulnerable to risk, regulation minimizes consumer exposure to harm and is paramount for maintaining market integrity. <\/p>\n<p>For example, it is now well established that Canadian businesses dealing with cryptocurrency (such as crypto exchanges) must register with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as a money services business (MSB). Registration means that these enterprises are subject to regulatory oversight and reporting requirements. As a result of these legislative obligations, fraudulent actors are more likely to be squeezed out of the space to make room for lawful players who can provide higher levels of investor protection. This legitimization of the digital asset industry is primarily why trading platforms are welcoming progressive regulation; working constructively between one another to increase security and transparency without stifling an industry that is still in its infancy.<\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>QuadrigaCX users lose $190M as speculations over Cotten\u2019s death swirl<\/em><\/strong><\/p>\n<p>Therefore, policymakers play an essential role in developing the necessary conditions to create a suitable framework for cryptocurrencies to operate safely. The CSA jurisdiction, along with the Investment Industry Regulatory Organization of Canada (IIROC), has <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.iiroc.ca\/Documents\/2021\/12d84d32-7a4b-4f81-b864-cb65f5ffd93b_en.pdf\">expressed<\/a> its interest in working closely with digital asset trading companies to understand their point of view, factor in key risks to innovation and ensure that investor protection is not compromised. <\/p>\n<p>Regulations of this magnitude cannot be rushed, and several factors have been taken into account by regulators to ensure that any new legislation only encourages the digital asset industry to boom. Allowing Canada to operate as a successful crypto venue while safeguarding investment security and fraud prevention are some of the key elements of the proposed regulatory framework. The sweet spot for regulation is somewhere in between \u2014 stringent enough to protect investments and fraud, and permissible enough to allow private and international digital asset companies to thrive. <\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>How smart regulation can improve the future of blockchain<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Canadian_regulatory_trends_in_2021\"><\/span>Canadian regulatory trends in 2021 <span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>When it comes to the integration of crypto into traditional investing, Canada has been remarkably advanced with its sanctioning of Bitcoin (BTC) and Ether (ETH) exchange-traded funds in 2021, allowing more mainstream investors the opportunity to have digital asset exposure through their investment accounts, including tax-advantaged registered retirement savings plans (RRSPs) and tax-free savings accounts (TFSAs). <\/p>\n<p>Canada also surpassed the United States by allowing digital asset exchange-traded funds (ETFs), setting a precedent of wanting to be competitive in the sector. In February, Purpose Financial LP\u2019s Bitcoin ETF <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.theglobeandmail.com\/investing\/article-etfs-for-investors-with-the-stomach-to-invest-in-bitcoin\/\">accumulated<\/a> over $400 million assets under management within its first two days and went on to cross the $1 billion mark within two months post-launch.<\/p>\n<p>With a growing portfolio of investments, one would assume that tax-related concerns could potentially arise. However, Canadian tax authorities have been fairly clear in matters of tax implications and have provided adequate guidance to investors along the way. Currently, Canada\u2019s tax laws and rules, including the Income Tax Act, also apply to cryptocurrency transactions. <\/p>\n<p>The Canada Revenue Agency has <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/loc.gov\/law\/\/help\/cryptocurrency\/block-rewards\/canada.php\">characterized<\/a> cryptocurrency as a commodity and stated that the use of cryptocurrency to pay for goods or services should be treated as a barter transaction. Because cryptocurrency is treated as a commodity, it has prevented the unfavorable misreporting of taxes as a result. However, the landscape is constantly evolving, so regulators must remain ahead of the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a> to avoid crypto enthusiasts looking at the United States, Europe or Asia as alternative playgrounds, draining Canada of both its talent and its investment. <\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>Stablecoins present new dilemmas for regulators as mass adoption looms<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Canada_stays_ahead_as_a_miners_paradise\"><\/span>Canada stays ahead as a miners\u2019 paradise<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Canada is a crypto miner\u2019s top choice, owing to its climate, electric supply and light regulation. Hardware used by cryptocurrency miners generates a significant amount of heat and requires cooling to prevent overheating, and being located in a relatively cool climate like Canada helps to reduce the costs of cooling the computers. Furthermore, power <a rel=\"nofollow noopener\" target=\"_blank\" href=\"http:\/\/www.hydroquebec.com\/residential\/customer-space\/account-and-billing\/understanding-bill\/comparison-electricity-prices.html\">rates<\/a> in Quebec are among the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cer-rec.gc.ca\/en\/data-analysis\/energy-markets\/market-snapshots\/2018\/market-snapshot-crypto-currency-mining-is-booming-in-canada-here-is-why.html\">lowest<\/a> in North America. For industrial consumers, rates are <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cbc.ca\/news\/business\/bitcoin-mining-electricity-canada-1.4543319\">around<\/a> $0.05 per kilowatt-hour. Energy consumption is the main cost of cryptocurrency miners, and understandably the top reason they\u2019re drawn to Canada.<\/p>\n<p>Finally, there is potential for Canadian digital asset companies to not just offer trading but also own and operate crypto mining facilities. Canada offers a safe haven for miners coming from politically and financially unstable environments to carry out operations within a relaxed framework, putting the country at the forefront of the digital currency revolution. Miners from previously heavy crypto quarries like China are on the lookout for favorable pastures with less hostile regulations and are now looking at Canada as a lucrative alternative.<\/p>\n<p>Thinking long term, there is also the sentiment of sustainability, and while traditional finance industries lean on carbon-based energy sources, digital assets are comfortably moving in the direction of greener energy. This is further <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/assets.ctfassets.net\/2d5q1td6cyxq\/5mRjc9X5LTXFFihIlTt7QK\/e7bcba47217b60423a01a357e036105e\/BCEI_White_Paper.pdf\">confirmed<\/a> by Square\u2019s report on the Bitcoin Clean Energy Initiative \u2014 a unique energy model that could enable the installation and capacity of more sustainable methods of solar and wind generation. Canada is a global leader in sourcing renewable energy, and a flexible regulatory framework around cryptocurrency could mean an influx of international players heading to \u201cThe True North.\u201d<\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>Ignore the headlines \u2014 Bitcoin mining is already greener than you think<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_does_the_future_hold_for_crypto_regulation\"><\/span>What does the future hold for crypto regulation? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>With the digital asset space being internet-native, fintech platforms can be built anywhere in the world. This globalization of the financial industry means that Canada cannot simply wait for a regulatory framework to become available, or it will lag behind in the innovation race. The onus is on regulators to incentivize digital asset investment and project development in their country. <\/p>\n<p>Familiarizing the Canadian market with digital asset trading with the introduction of more crypto-asset trading platforms is a solid first step. The next decade will see a lot more regulation introduced into the sector. Governments that are smart and forward-thinking will see an obvious opportunity to offer clear but not overly restrictive regulation, and become a welcoming place for digital asset projects. <\/p>\n<p>Historically, authoritarian governments \u2014 where hostile and unstable rule-making induces a net negative to their economy \u2014 are more likely to impose stricter measures on digital assets, which could inevitably force industry participants to move to countries like Canada that offer relatively favorable conditions. Digital asset companies will continue to move to wherever they are most welcome, and the countries that facilitate these moves will be much better positioned to reap the benefits of the digital asset industry as it continues to grow and threaten traditional finance. <\/p>\n<p class=\"post-content__disclaimer\"><em>This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.<\/em><\/p>\n<p class=\"post-content__disclaimer\"><em>The views, thoughts and opinions expressed here are the author\u2019s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.<\/em><\/p>\n<div>\n<div style=\"background: rgb(239, 239, 239); border: 1px solid rgb(204, 204, 204); padding: 10px;\"><strong>Desiree Smith<\/strong> is a Canadian lawyer with a passion for emerging technologies and innovation. Fintech and blockchains are her main specialties, and she is currently the director of business and legal affairs at Coinsquare, a crypto exchange based in Canada. In addition to her role at Coinsquare, Desiree also teaches a crypto course at Ryerson University that focuses on legal, governance, risk and compliance issues surrounding blockchain, smart contracts and cryptocurrency technologies.<\/div>\n<\/div>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/crypto-in-canada-where-are-we-today-and-where-are-we-heading\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Crypto in Canada: Where are we today, and where are we heading? &#8221; Digital currencies are quickly becoming more mainstream within the Canadian financial landscape. Alongside this increased adoption, Canada has been relatively successful at creating a stable regulatory environment. In 2014, Canada established itself as a leader in the global digital asset space&#8230;<\/p>\n","protected":false},"author":1,"featured_media":284745,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDYvZDg4NDFhYTMtNGIwOC00YTdmLWIwNDUtMjE5NGVhZTM0MThlLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74989,74858,74894,74863,75042,22974,71511,70934],"class_list":["post-284744","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-mining","tag-bitcoin-regulation","tag-blockchain","tag-cryptocurrencies","tag-mining","tag-canada","tag-government","tag-regulation"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/284744","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=284744"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/284744\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/284745"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=284744"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=284744"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=284744"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}