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CANADIANLAWYERMAG.COM/INHOUSE JANUARY/FEBRUARY 2019
BY LUIS MILLÁN
The cryptic world of
crypto-currency
regulations
H
ong Kong has forged ahead. So, too, has Japan. A
host of small countries and territories also have
quickly moved forward, eager to roll out the
welcome mat for nascent crypto-currency companies and
projects searching for regulatory certainty.
But most regulators around the world are still grappling
over their next moves, even as they face growing calls — including by industry — for
greater regulation of virtual currencies to bring an element of control to a market that
has often been described as the "Wild West." A hands-off approach by policy-makers
has been shelved after Bitcoin's spectacular surge caught the public imagination while
the growing numbers of crypto-currencies in the market, too, have sparked concerns.
There are nearly 2,100 crypto products available, and dozens more are launching every
month. All told, the market capitalization of crypto assets was pegged recently at $230
billion, and trading volume has grown almost a hundred fold in the past two years and
is now estimated at $15 billion annually, according to fi gures by the Bank of Canada.
Most of the G20 countries, however, are unlikely to follow in the footsteps of Ber-
muda, Gibraltar, Malta and Liechtenstein, all of which recently introduced friendly
and liberal regulatory regimes to foster crypto havens. Concerns over the price vola-
tility of crypto assets, security breaches, the absence of investor and consumer pro-
tection and fears it could be used to launder money or fi nance terrorist activity loom
large at G7 and G20 tables.
But striking a balance between providing adequate investor and consumer protec-
tion while imposing regulations that do not stifl e innovation in the burgeoning sector
is proving to be daunting for regulators, a bind that Canada, too, faces as it carves
Is it time for a co-ordinated
international regulatory
framework to deal with
digital assets?
I n d u s t r y S p o t l i g h t
