Canadian Securities Administrators Publish Rules for Crypto Trading Platform
Regulations for cryptocurrency brokerage firms functioning in Canada were published by the Canadian Securities Administrators (CSA). The CSA and the Investment Industry Regulatory Organization of Canada together released Guidance for Crypto-Trading Platform (IIROC).
It was released on the 23rd of September and discusses what’s needed before doing any marketing or advertising at all. Social media, security, and other cryptocurrency-linked practices are all addressed in the regulations. Regulation of cryptocurrency brokerage firms in Canada was deemed critical by authorities.
According to the organizations, some platforms’ marketing tactics and promotional activities prompted the publication of recommendations. Canada’s securities regulators, the CSA and IIROC, are concerned that cryptocurrency trading platforms are flouting the country’s securities laws.
Such exchanges, according to the authorities, are also culpable of igniting investor worries about their safety. The Notice is divided into four sections, each with their own guideline. Starting with marketing and promotional materials that may be inaccurate or misleading, the legislation is aimed at preventing them from being used in the future.
Additionally, the CSA and IIROC are working to address cryptocurrency trading platforms’ and exchanges’ usage of gambling-style competitions. In this manner, cryptocurrency exchanges compensate their users according on how much they trade. As a result, individual investors engage in a flurry of transactions in an effort to maximize their profits.
This strategy is often used by new trading platforms to entice individual investors and expand their user base. In the guide, officials provided an example to bolster their point:
Promotions incorporating bonus schemes may give the initial 500 investors who take action over the following 24 hours a cash incentive or a bonus interest in specific types of crypto assets.
“Certain methods worry us because they may inadvertently encourage investors to participate in hazardous trading and take risks they otherwise wouldn’t.” Regulation of social media usage to foster cryptocurrency trading platforms is also included in this updated guidance.
The Notice also included information on how to comply with securities laws. For the same reasons, the Securities and Exchange Commission (SEC) in the United States has often expressed worry about the safety of crypto investors.
The Securities and Exchange Commission (SEC) has been a vocal proponent of cryptocurrency regulation in the United States. Regulatory agencies are typically worried about the safety of cryptocurrency investors since unsophisticated investors continue to fall prey to frauds.
Hackers have gained access to the Bitcoin.org website, according to the site’s administrators. The perpetrators used a pop-up on the webpage to solicit contributions in Bitcoin. The allure was that contributors would get a contribution that was worth twice as much. This was done to make it seem more legitimate by saying that the prize was only for the initial 10,000 users.
Other than posing as prominent individuals in the cryptosphere, hackers masquerade as ordinary users in order to steal their money. While part of the stolen money is returned to its rightful owner, additional money is scattered to the four winds.