As of June 2020, all the cryptocurrency firms are recognized as Money Service Businesses or MSBs in Canada. Canada is following Recommendation 16, a document that was worked out by the Financial Task Force in 2019. The recommendations are a set of standards on fighting against money laundering (AML) and counter-terrorism financing(CTF). All FATF member countries are recommended to adopt the standards and make them law. Recommendation 16 advised regulating cryptocurrencies the same way that the countries regulate traditional money. Digital currencies are increasingly popular in Canada. Despite the QuadrigaCX scandal that stained the reputation of the crypto exchange firms. A death certificate of a 30-year-old CEO of QuadrigaCX was issued in India. The cause of death indicated in the document was suspicious, so the death of the CEO is still debated. He was the only person with access to a couple of hundred million dollars of assets of the clients of QuadrigaCX. Despite this story, cryptocurrencies are gaining strength in Canada. FATF regulations officially made the digital currency firms Money Service Businesses.
Crypto’s influence on Digital economy of Canada
The digital currency industry is a big part of Canada’s economy. Fintech is supported and promoted by the government. Many fintech start-ups get funding to develop their ideas further or bring them to life. Canada has a very welcoming ecosystem for digital industries. When Justin Trudeau took over the country in 2016, his team started working on a plan for the development of the digital economy. In 2019 the Ministry of Innovation, Science, and Industry published Canada’s Digital Charter. The document is a set of principles and values the country will stand by while working on advancing the digital economy. The document talks about values such as equality, safety, and transparency. Canada wants to provide all its citizens with equal access to digital technologies and create a safe environment. Digital currency is a big part of the digital economy. A good example of the use of digital currencies is the iGaming and online casino industry. Several years ago iGaming platforms started accepting digital currencies along with traditional sources. From 2017, not only Canadians but also international gamers play casino games online for bitcoin. The users of iGaming platforms loved this change for many reasons. The transactions of the traditional money can take days. It takes especially long if the user is in another country. The cryptocurrency transactions, however, can take under an hour. The time-consuming work of money transactions became easy and fast. The users could now spend more time gambling and less time worrying about the transactions. More international users joined Canadian online casinos once this change was introduced. The providers accept Ripple, Bitcoin, Ethereum, PayPal, and other currencies. iGaming platforms also provide a great variety of options when it comes to the forms of gambling. All traditional gambling methods that the users would find in casinos are available on iGaming platforms. So, the users can play at poker tables, slot machines, roulette and enjoy the best gamers of the world come together for a video game tournament. iGaming platforms are constantly adapting popular games and characters for their users.
Tighten regulations on Crypto in Canada
Digital currency firms have to follow the same rules as other Money Service Businesses as of June 2020. The Financial Transactions and Reports Analysis Center of Canada (FINTRAC) will soon announce the new anti-money laundering (AML) and counter-terrorist financing (CTF) regulations. March 10th, FINTRAC released a report, where it is said that they will put a lot of effort into regulating cryptocurrencies. The report also says that the regulators face more challenges as technology advances. Any transactions exceeding 10,000 Canadian dollars in cryptocurrencies will have to be reported. Digital currencies are very vulnerable to money laundering and counter-terrorism financing violations. FINTRAC will consult the stakeholders and work with the industry representatives. The digital currency firms located outside Canada that have Canadian clients or operate in Canada will be subject to the same laws.
