Canada to amend its rules on cryptoassets

The Canadian Securities Authority (CSA) announced proposed changes to the regulations governing the management of crypto assets by public investment funds. These amendments, which are currently under consideration, aim to restrict the operations of such funds in the field of cryptocurrencies and to establish specific criteria for their custody.

Under the proposal, only AIFs and non-redeemable funds would be allowed to directly acquire, sell or hold crypto assets. The other mutual funds would be able to invest in crypto assets exclusively through these specialised funds. In addition, assets selected for investment must be listed on a stock exchange recognized by a securities regulator in Canada and be fully fungible.

The new provisions also stipulate that assets must be insured and stored in cold purses. An annual review of the custodian’s internal management practices, conducted by a public accountant, will be implemented.

These amendments will be incorporated into National Instrument 81-102 on Investment Funds and its Complementary Policy. It should be noted that a national instrument in Canada represents a regulation or mandate adopted at the provincial and territorial level across the country.

In the words of the CSA: “These measures seek to facilitate the development of new products in the crypto-asset space, ensuring the incorporation of appropriate risk mitigation strategies into the regulatory framework of investment funds.”

These amendments are part of a draft that was announced in July. Proposals will be subject to a 90-day public consultation period, following which a consultation paper will be drafted and a broader regulatory framework for cryptoassets will be assessed.

K. Tovar

Source: Cointelegraph

(Reference image source: Unsplash+)

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