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In June 2019 this bill was passed in the legislation, in an attempt to fix-up chinks in the existing crypto framework.

A report by CoinTelegraph suggests that the Canadian crypto firms will have to separately register every transaction above 10,000 Canadian dollars.

In a nutshell, the Canadian government has made all the crypto companies in the country a legitimate money service business. While the decision was welcomed by the CEO of Canadian crypto-asset exchange BullBitcoin, Francis Pouliot, there are others who feel indignant. 

Some crypto firm owners feel the new notice is too harsh. Also, registering every transaction above $10,000 does not make the system fool proof. There are still factors left that need to be analysed.

What Does the "Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets" State?

On January 16, 2020, the Canadian Securities Administrators released a document "CSA Staff Notice 21-327." It clearly states that the crypto firms in Canada will no longer have the autonomy to operate as an anonymous entity. They will now be functioning more like a conventional bank or a financial institution.

The CSA will also decide whether a crypto firm offers simple exchanges or trades in securities and derivatives. Overregulating cryptocurrencies defeats the purpose because they became popular for giving the user freedom to transfer assets to whoever they want without the government or a thirty party entity watching over their shoulders.

A cryptocurrency account holder was able to transfer funds to another user immediately, within seconds. Cryptocurrencies like Bitcoin have to register each transaction in an internal ledger, which is clearly not enough and infringes on users' privacy. The guidance has posed several such unreasonable regulations on crypto firms.

Is Your Money Safe?

Although investing in cryptocurrencies is one of the surest ways to keep your money safe and secure, some unforeseen events can lead to a financial loss. On February 1, 2019, $190 Million worth of Bitcoin, Bitcoin Cash, Bitcoin Cash SV, Bitcoin Gold, Litecoin, and Ethereum was gone forever. The founder of QuadrigaCX passed away without revealing the master wallet's password. Investors have no way to get their money back. 

CEO Gerald Cotten's wife had filed an affidavit detailing the reasons behind her husband's death. Gerald passed away due to Crohn's disease during his visit to India. Gerald's wife stated that her husband was supposed to safeguard the crypto assets in cold storage.

Unfortunately, his company did not have the technology to make that happen. Most major crypto companies keep their wallets in cold storage to protect them from hacking and security breaches.

Beating the very nature of cryptocurrencies

The very nature of cryptocurrencies makes them very hard to regulate. Being decentralised, in some cases it's impossible to find and convict individuals of illegal activities such as fraud. In fact, idea behind the whole crypto movement was to bypass banks and give users freedoms they don't have with traditional financial institutions. Online services who introduced this form of payment for their benefits often find that governments are beating the very nature of cryptocurrencies with regulations. For example, paying for live roulette online in a casino that supports crypto payments is often not as fast and easy as one would expect, and most such online services don't even go down the "bitcoin road". Because of regulations and certain limitations, it's easier to stick with traditional payment methods, so that's what licensed operators do in most cases.