Canada has amended the regulations against money laundering. The changes will affect cryptocurrency exchanges and their operations.
Changes in regulations
On Wednesday, July 10, the Canadian government published proposed changes to the laws on preventing money laundering and financing of terrorism. Changes in financial matters describe a number of gaps existing in the system, while notes concerning trade in virtual currencies are noticeable. The government explains that such activities include
cryptocurrency exchanges and services offered there.
Regulations from this moment classify both Canadian and foreign cryptocurrency exchange platforms as
companies providing cash services. They must, therefore, comply with all regulations, as well as introduce a comprehensive
FINTRAC (Financial Transactions and Reports Analysis Center of Canada) compliance policy.
In addition, any cryptocurrency transaction worth more than 10,000 Canadian dollars (approximately 7700 USD) must contain all details about the sender and must be reported to the appropriate authorities.
Amendments are to reduce money laundering and terrorist financing through cryptocurrencies. We direct them to people or companies dealing with cryptocurrencies on a daily basis and implement them in a manner consistent with the existing legal framework.
- this is part of the Canadian Government's statement on the matter.
Causes
The changes came many months after the head of the
QuadrigaCX exchange,
Gerald Cotten, died in February this year and most likely did not hand over the keys to his wallets to anyone. The debt to customers totalled $190 million. The further functioning of the stock exchange was incorrect and it declared bankruptcy in April.
Canadian financial lawyers were considering introducing cryptocurrencies in March, but they did not have a plan at the time.
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