Overview 

The Cana­dian Se­cu­ri­ties Ad­min­is­tra­tors (CSA) pub­lished CSA Staff Notice 81-336 Guidance on Crypto Asset Investment Funds that are Reporting Issuers, to help fund managers understand and comply with securities law requirements for public investment funds holding crypto assets (public crypto asset funds).

The guidance provides an overview of public crypto asset funds operating in Canada and describes related oversight initiatives by CSA members. The notice also covers:

• Market characteristics of crypto assets that could impact their viability as investments for public crypto asset funds
• Expectations concerning custody of crypto assets held on behalf of a fund
• Issues relating to yield-generating activities, like staking, by public crypto asset funds
• Know-your-client, know-your product and suitability obligations with respect to public crypto asset funds.

The CSA reminds Canadians that investing in crypto assets, even through public investment funds, is higher risk and may not be suitable for most retail investors. Investing in crypto assets is a speculative activity, and the value and liquidity of crypto assets are highly volatile. While regulatory oversight of public investment funds plays an important role in investor protection, these measures cannot eliminate all risks associated with investing in crypto assets.

Recent developments

Amendments under consideration

• None