Photo by Hermes Rivera on Unsplash
Many people may not know but Canada is already a world leader on many fronts of the cryptocurrency and blockchain ecosystem.
Canadians are innovating like crazy in this space. Our technical accomplishments and collective knowledge is arguably the best in the world. However, the next phase to adoption of this technology is how progressive our policy makers are.
A few months ago FINTRAC, Canada's financial compliance agency, published a proposal for new regulations that involve cryptocurrencies. At first glance it seemed decent but we had many questions and concerns. As a result we promptly started to meet with other organizations and stakeholders in the cryptocurrency and blockchain space, everyone from lawyers, to policy makers, and banks to miners, ATM networks, exchanges, protocol developers and service providers like us.
Over the last few months and after talking with over 100 different stakeholders we compiled and submitted our feedback to FINTRAC. Here is what I told them:
Dear Lynn Hemmings & Lisa Pezzack,
First off, I wanted to thank you for the continued work on making Canada a progressive regulatory environment for new and novel financial transaction methods.
My company Bidali is a newly formed payments company that is bridging the traditional fiat payment rails with the new and innovative blockchain backed payment rails. We are a proud Canadian company at the forefront of this technological innovation and are competing admirably with companies all over the world. We intentionally chose to be based in Canada because we believe that it can provide us with a competitive advantage and we want to grow and diversify the economy.
Unfortunately, this policy proposal may have some unintended consequences that jeopardize that. We believe that with the right regulatory framework in place Canada can be a leader in this emerging global market and we hope to be part of that story. Without it we will be destined to be left out.
Currently there are hundreds of millions of dollars leaving Canada and due to the borderless nature of how cryptocurrency works it is nearly impossible to stop this flow of funds. Therefore, we believe it is in our best interest as an already safe, trusted and progressive nation that we encourage responsible usage of digital currency and provide a safe haven for companies that are furthering this technology in a responsible way.
Contrary to popular belief many of these new blockchain payment rails that power cryptocurrencies do not provide anonymity and the majority of transactions are not used for money laundering. Gift cards and cash are still a much more efficient way for people to launder money. In fact, with the right tools in place public immutable distributed ledgers have the ability to vastly reduce fraud, money laundering, compliance costs, and improve financial audibility and automation. By restricting the usage of this technology we are missing out on these benefits.
I’ve attached our feedback on the proposal for consideration. Thank you for looking at it. We would welcome the possibility of consulting or providing continued feedback on future proposals.
You can read our full feedback here.
To my surprise they responded rather promptly with this document which addresses most of our concerns, questions and feedback. Once today's feedback deadline has closed FINTRAC will be updating their proposal with these amendments and doing another round of consultation.
To be honest, I'm quite impressed with how efficient and progressive the Canadian government has been with cryptocurrencies. I think these updated amendments are a great balance between allowing innovation and ensuring that cryptocurrencies are used responsibly.
We've always been a proud Canadian company and have held the belief that being here would provide us with a competitive advantage. The way the Canadian Government is thinking about cryptocurrencies and blockchain has only reinforced these beliefs and have me very excited for the future. 🇨🇦 🙌