To decide what laws to put on the crypto industry, the Canadian government has begun discussions with shareholders.
Consultations by the Canadian government on cryptocurrencies, stablecoins, and CBDCs will start soon.
Such assets, according to the ruling council, should operate under close control since they could support illegal activities and present “a danger to democratic institutions.”
One of the budget’s priorities is cryptocurrency
Canada’s federal government intends to place regulations on the local cryptocurrency industry, as stated in its mini-budget for 2022. To discuss the advantages and disadvantages of digital assets, stablecoins, and CBDCs, the officials began a series of talks with shareholders.
The Canadian government said that this is an important step because the global financial system has changed as a result of the digitalization of money. They also think that bad actors utilize bitcoins to avoid punishment and fuel illicit activities:
“In the last several months, digital assets and cryptocurrencies have been used to avoid global sanctions and fund illegal activities, both in Canada and around the world.
In order to help address these challenges in Canada, Budget 2022 announced the government’s intention to launch a financial sector legislative review focused on the digitalization of money and maintaining financial sector stability and security.”
After Putin began his “special military operation” in Ukraine, many politicians and financial experts cautioned that Russia would use digital currencies to get over some of the restrictions put in place by the West.
Contrarily, Changpeng Zhao, CEO of Binance, the largest cryptocurrency exchange in the world, believes that bitcoin and other cryptocurrencies are not a suitable alternative to avoiding financial penalties. The executive claimed that because of the underlying blockchain technology, the asset class is excessively traceable and that governments all around the world can readily find such transactions.
Bank of Canada’s Position
The government of the North American nation has repeatedly been encouraged by its central bank to implement regulations on the sector.
In June, Senior Deputy Governor Carolyn Rogers stated that the action must be finished as soon as possible because the asset class is changing and drawing in new investors. She believes that some people are unaware that when they enter the ecosystem, they could lose everything they have invested.
“This is an area that is still small, but it’s growing really rapidly. We don’t want to wait until it gets a lot larger before we bring regulatory controls in place,” she alerted.
As of the end of 2021, the Bank of Canada projected that 13% of the country’s adults were HODLers, and 90% of people were aware that bitcoin existed.
According to the institution’s survey, people with less financial awareness are the ones who are most drawn to BTC. The second-most likely demographic to possess the main cryptocurrency is investors with significant economics understanding.
