Canadian government has reportedly come up with new guidelines to categorize which crypto coin trading platforms will need to be in compliance with derivatives law.
Specifically, the Canadian Securities Administration (CSA) has freshly rolled out a new guideline – dubbed “the “Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets” on January 16th.
Generally, the Canadian governmental body looks to distinguish between trading platforms, which offers instant crypto assets delivery to clients, and the ones that abstain from executing the crypto assets transaction process, until a request was submitted by customers.
After a thorough research into trading methods across numerous platforms, the CSA concluded that only a fracture of the platforms transfer the contractual right or claim to a crypto asset instantly to clients.
“Potentially, there will be ongoing reliance and dependence of the user on the Platform until the transfer to a user-controlled wallet is made. Until then, the user would not have ownership, possession and control of the crypto assets without reliance on the Platform. The user would be subject to ongoing exposure to insolvency risk (credit risk), fraud risk, performance risk and proficiency risk on the part of Platform.”
Crypto exchanges, which hold the crypto asset that is not viewed as security or derivative, and send the digital assets to the users right away, will not have to comply with the CSA-established securities law.