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Canadian securities regulators publish additional guidance for entities facilitating the trading of crypto assets

  • Securities - CSA Image

Jan 16, 2020

On January 16, 2020, the Canadian Securities Administrators (CSA) published Staff Notice 21-327 "Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets", to help these entities to determine situations where securities legislation may or may not apply.

The notice describes situations where securities legislation will and will not apply. For example, securities legislation may apply to platforms that facilitate the buying and selling of crypto assets that are commodities, because the user’s contractual right to the crypto asset may itself constitute a derivative, a security or both.

The relevant determination will depend on the facts and circumstances, including the obligations and intention to provide immediate delivery of the crypto asset. The notice provides guidance on what constitutes immediate delivery, together with a detailed example of a situation where securities legislation does not apply.

Review the press release on the CSA's website and the Staff Notice on the OSC's website.

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