As anxiety grows around every new twist and turn in the ongoing QuadrigaCX drama, along with extensive QuadrigaCX media coverage, Canada’s mainstream media has been calling on the government to bring in better oversight and regulation of cryptocurrency businesses, especially cryptocurrency exchanges.In response to these calls for more regulation and calls from some crypto businesses for more regulatory clarity, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) released a discussion paper on March 14, 2019, with a “New Proposed Platform Framework” that would aim to specifically tailor regulations to the special risks posed by cryptocurrency exchanges.The CSA consultation paper, which can be viewed here, asks 22 questions and requests comments from crypto/fintech companies, market participants/investors and other crypto stakeholders about what regulations would best fit in the unique new cryptocurrency marketplace.When Is a Crypto Exchange a Securities or Derivatives Dealer?As a number of observers have commented, this round of consultations is mainly about how to define the new business of cryptocurrency exchanges and how far to go in imposing old regulatory models on a new economic system.Calgary-based securities and cryptocurrency lawyer Matt Burgoyne commented on Twitter:“There is a lot to unpack in the new CSA consultation paper on cryptocurrency exchanges. ...
