Canadian regulatory body, the Ontario Securities Commission (OSC) seems to be effecting its proposed policies on cryptocurrencies. The OSC is one of the territorial agencies that the Canadian Securities Administrators (CSA) presides over. It is also one of the biggest Authorities and monitors the Toronto Stock Exchange.
The OSC undertook the enforcement action against Poloniex. Poloniex is one of the biggest cryptocurrency exchange headquartered in the US but with an office in Canada. The enforcement indicates that the OSC seeks to have Poloniex focus on customer funds as a security. According to the statement, Poloniex investors do not have any control over deposited assets.
The exchange platform is meant to offer the facilitation of trading services. These services are considered the instruments that constitute securities or derivatives. Grant Vingoe, who is the Chairman of the OSC explained that the security isn’t cryptocurrencies but a combination of contract rights of the client and the delivery of the platform.
The Canadian regulatory body had begun earlier to make changes in crypto regulations. The aim of this is to treat digital assets likeBTC or ETH as commodities instead of securities. This move is to ensure that investor funds are responsible to the platform.
The Significance of the Poloniex Enforcement
The OSC seems to be toeing their lines after requesting that cryptocurrency exchanges get registered and given the appropriate regulations to operate with. The deadline for the crypto entities to do this is April 29. The basis of the action taken against Poloniex is due to their inability to meet the OSC demands.
A major takeaway is that the OSC isn’t overlooking it’s decisions on crypto asset managers. A spokesperson from the OSC has told the Block that about 70 exchanges were warming up to the authority for “compliance talks”. It might not be possible for OSC to institute actions against defaulters, however, some of them might be made to exit the Canadian Market – which might be the case with Poloniex.