Exchanges gear up crypto advocacy in Canada as elections loom

Canada has been actively developing and refining its regulatory framework for digital assets over the previous years, positioning itself ahead of leading markets worldwide, such as the United States. However, crypto exchanges are still lobbying for more cooperation with leaders as the 2025 elections approach in the country. 

Cointelegraph’s senior editor, Sam Bourgi, discussed with Kraken and Coinbase during the Blockchain Futurist Conference how the local regulatory space is evolving and where the country is still lagging behind.

“The reality is that members of parliament today in Canada are not hearing from their constituents about the importance of digital assets and cryptocurrencies,” explained Coinbase’s CEO for Canada, Lucas Matheson.

The exchange has exported its advocacy initiative, Stand With Crypto, to mobilize the crypto community’s engagement in the legislative process. “There’s a lot of opportunity to raise the profile of digital assets and cryptocurrency with public officials in Canada,” said Matheson.

Related: New Canadian rules for crypto trading platforms leave little room for stablecoins

Crypto exchange Kraken has also been active in engaging with regulatory arms in the country, according to Alex Mehrdad, general manager for Kraken Canada.

“We have a lot of frequent discussions with the regulator here in Canada, so there’s a collaboration,” noted Mehrdad, adding that “it’s very important for us to move the framework forward or kind of try to educate the regulator on new products or new usages.

Without disclosing figures, Kraken’s executive said the exchange has observed a growing adoption of digital assets in the country since 2023. “Somewhere around 15% of Canadians own crypto today, but 50% want to own crypto.”

QuadrigaCX’s effect on regulation

Over the previous few years, crypto trading platforms in Canada have been required to register as “restricted dealers” under an interim framework while they work toward full registration.

The framework is a response to the collapse of Canada’s former largest crypto exchange, QuadrigaCX, that resulted in the loss of nearly $190 million in customer funds in 2019 after its founder’s sudden death.

The growing integration of cryptocurrencies with Canada’s economy led the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) to introduce the “restricted dealer” category, which imposes certain obligations to exchanges, such as adhering to Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements, maintaining sufficient capital, and implementing robust internal controls.

“The restricted dealer is sort of pathway [...] for all the different exchanges to operate within a framework that creates certainty and creates safety for clients as well. We’re very positive in terms of how the regulatory framework is evolving,” said Kraken’s executive.

Coinbase is currently seeking its full dealer registration in the country, targeting to expand services on specific fronts, such as stablecoins, digital assets custody and remittance services. “One in five Canadians remit money around the world, paying 6% to 12% [in fees].”

Canada was the first country to approve Bitcoin and Ether exchange-traded funds (ETFs) back in 2021.

Magazine: Lawmakers’ fear and doubt drives proposed crypto regulations in US