The 2014 omnibus federal budget bill (Bill C-31) saw the introduction of legislation that would regulate dealers in virtual currencies as “money services businesses” under Canada’s Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The implementing regulations are not yet published; however, June did see the release of Digital Currency: You Can’t Flip this Coin!, a report by the Senate Standing Committee on Banking, Trade and Commerce.
In the report, the senators recommend that “the federal government, in considering any legislation… create an environment that fosters innovation for digital currencies and their associated technologies.” The report also urges government to use a regulatory “light touch” to minimize “stifling” the development of payment, value storage and transmission technologies.
The report contains a concise and up-to-date overview of the principal issues, and has been welcomed as farsighted and forward-thinking by the digital currency (Bitcoin) community. It is worth paying attention to what is happening in the payments area, of which cryptocurrencies and blockchain technologies are a part.