The Canadian Securities Administrators (CSA) has issued a warning to investors considering crypto purchases through trading platforms.
The regulator said that currently there are no crypto-asset trading platforms recognized as an “exchange” or otherwise authorized to operate a marketplace or dealer in the country. Importantly, these platforms might not be in compliance with the securities regulatory regime.
“We want investors to understand that just because a platform may advertise itself as an exchange, that does not mean the platform is complying with applicable securities regulations,” said Louis Morisset, Chair of the CSA and President and CEO of the Autorité des marchés financiers. “If it is not, investors should not expect to receive the same protections that are built into the securities regulatory framework applicable to exchanges or dealers, and should therefore be cautious.”
In August 2017, the CSA issued guidelines on how securities law requirements may apply to Initial Coin Offerings (ICOs), tokens, cryptocurrency investment funds, and the cryptocurrency exchanges trading these products. It emphasized that the platforms engaging in the trading of crypto assets or interests in crypto assets that are securities or derivatives are required to comply with securities legislation.
In late 2017, the regulator had issued a warning to dealers and investors against the inherent risks associated with products linked to cryptocurrencies, including futures contracts.
