The Ontario Securities Commission (OSC) has began to study the activities of local cryptocurrency exchange trading platforms. According to OSC representative Kristen Rose, the agency received a “number of complaints” about platforms selling digital currencies that could possibly be categorized as securities. This is reported by CoinDesk.
“These platforms, and any businesses that allow coins/tokens that are securities to trade on them, may be offside securities laws,” Rose added.
It is noted that in accordance with local laws, exchanges are required to file an application with the OSC and be officially recognized. Thus, companies should document various aspects of their activities, including corporate governance principles, commissions, necessary requirements for access to services and so on.
According to the publication, none of the platforms that are currently under study by the OSC are legally recognized in Ontario. At the same time, the Commission notes that this is not yet a full-scale investigation because at the moment “the agency is simply collecting information on the activities of [the platforms].”
Nevertheless, the OSC mentioned that initial coin offerings (ICO) “present significant investor protection issues.” However, the position of the OSC in regard to IСОs not entirely hostile as the OSC recently approved the sale of TokenFunder in October.
Recall that earlier, following the financial regulators of the United States and Singapore, a statement explaining its position about initial coin offerings was made by the Canadian Securities Administrator.
The published document set out a framework of requirements for companies involved in the launch and management of ICO, as well as for exchanges that subsequently list these assets. It was noted that “many” digital tokens, which Canadian regulators studied, fall under the definition of securities. As a consequence, this entails the need to comply with certain legal requirements.